BitNile Holdings, Inc a diversified holding company announced that Circle 8 Newco LLC (“Circle 8 Newco”), a newly formed indirect subsidiary of Ault Alliance, Inc. (“Ault Alliance”), a wholly owned subsidiary of the Company, has entered into an asset purchase agreement (the “Agreement”) with Circle 8 Crane Services LLC (“Circle 8”), providing for the acquisition of substantially all of Circle 8’s operating assets (the “Assets”) and recapitalization of the business into Circle 8 Newco for an aggregate consideration of approximately $40 million (the “Acquisition”). The Acquisition will be funded with $16 mm in cash and approximately $24 mm of asset-based debt will be assumed.
“We are very excited to partner with the Brysons and Paramount as a platform for future growth”
Circle 8 is a crane rental and lifting solutions provider founded in 2007 and headquartered in Corpus Christi, TX with multiple locations throughout the South Central region of the U.S. It maintains a large modern fleet of mobile cranes for its customers’ heavy lifting needs. In particular, Circle 8 provides crane operators, engineering, custom rigging and transportation services for oilfield, construction, commercial and infrastructure markets. Circle 8 maintains an industry leading safety record.
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As BitNile has disclosed in prior announcements to the public, it intends to have Ault Alliance become a separate reporting public company in the first half of 2023. BitNile has also disclosed that Ault Alliance is a diversified holding company focused on Bitcoin mining, data center operations, commercial lending, activist investing, oil exploration, hotel operations and other commercial real estate holdings. Circle 8 Newco, including the Assets acquired from Circle 8 at the closing of the Acquisition, constitutes an entity within Ault Alliance, and hence it will be included within any filing made with the Securities and Exchange Commission by Ault Alliance.
Ault Alliance is partnering with equipment rental specialist private equity group, Paramount Lifting Solutions LLC (“Paramount”) and existing management, Phillip and Allen Bryson, in the investment. Ault Alliance, Paramount, and management will own approximately 64%, 20%, and 16%, respectively, on a fully diluted basis, of Circle 8 Holdco LLC, a newly formed entity that is the sole member of Circle 8 Newco.
The closing of the Acquisition is expected to occur on or prior to December 9, 2022. The consummation of the transactions contemplated by the Agreement are subject to various customary closing conditions and the receipt of certain third party consents. In addition to customary closing conditions, the closing of the Acquisition is also conditioned upon the receipt by Circle 8 Newco of financing in an amount sufficient to consummate the transaction.
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“We are very excited to partner with the Brysons and Paramount as a platform for future growth,” said Christopher Wu, President of Ault Alliance. Mr. Wu continued, “This Acquisition is in line with Ault Alliance’s strategy of investing in enterprises that provide current cash flows which we believe will increase through the provision of additional equipment and technology to create shareholder value. Based on current market conditions and presuming the closing of the Acquisition, Circle 8 Newco is forecasted to generate more than $40 million of annual revenue in 2023.”
“On behalf of the Circle 8 employees and management team, we are pleased to partner with the Ault Alliance and Paramount teams. Their global network and extensive industry knowledge will lay the foundation for sustained growth and innovation,” said Phillip Bryson, CEO of Circle 8.
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