Overview
Rumble has made a strategic move by announcing plans to acquire the cloud computing firm Northern Data in an all-stock deal. This merger seeks to enhance Rumble’s cloud infrastructure leveraging Northern Data’s established data centers and GPU operations. The expected outcome is a stronger position in the AI-focused cloud computing sector while emphasizing data privacy and independence.
Key Details
- The acquisition indicates that both firms are backed by Tether, which has a 54% stake in Northern Data and has invested $775 million in Rumble.
- Rumble plans to exchange 2.319 newly issued shares for each share of Northern Data, which means that current Northern Data shareholders will own around one-third of the combined entity.
- Post-merger, Tether is set to become the largest shareholder of Rumble’s Class A common stock, completing a swap of shares to ease financial pressure after the merger.
Additional Information
Chris Pavlovski, CEO of Rumble, retains voting control, positioning the company as a potential leader in AI cloud services and privacy-focused infrastructure. The announcement has positively impacted Rumble’s stock, with a notable initial gain before settling to a 7% increase from the previous week’s close.
Related Information
- The merger coincides with Rumble reporting a revenue increase despite a loss of $30.2 million in the second quarter.
- Northern Data’s operations will integrate additional GPU resources and improve data center capacity significantly.
