Hedge fund Sachem Head believes Ionic’s stock still has room to rise.

Svea Herbst-Bayliss

Reuters, New York, October 20 - Hedge fund Sachem Head Capital Management said on Tuesday that, as data center power demand surges, former Bitcoin mining company Ionic Digital (ticker symbol: IOND.O) is transforming into a digital infrastructure leasing business, and the company's stock price is expected to more than double.

Ionic was established after the bankruptcy restructuring of the cryptocurrency lending firm Celsius Network, and began trading on the Nasdaq Stock Exchange in July, with its current stock price around $63.

However, Sachem Head founder Scott Ferguson said at the “13D Monitor Active-Passive Investor Summit” in New York that the stock still has room to rise, with a potential increase to $151 per share, a gain of nearly 140%.

Sachem Head, together with Oaktree Capital Management and Attestor Capital, participated in a 400 million dollar private placement in June and currently holds nearly 10% of the company’s shares.

Sachem Head holds about 9.9% of Ionic; Ferguson said that the company will file regulatory documents with the U.S. Securities and Exchange Commission on Wednesday detailing its shareholding status.

Ionic has signed a 10-year “three-network” lease agreement with Nscale in Ward County, Texas, which can be extended for another 10 years. Nscale is a vertically integrated artificial intelligence infrastructure and new cloud company based in London, operating high-density GPU (graphics processing unit) data centers and cloud platforms.

Ferguson said the end customer for the site is Microsoft.

He added that the expansion in Ward County and a site in Midland, Texas, will help push the stock price higher.

“We think management is performing quite well,” Ferguson said, though he added that his firm—which from time to time urges target companies to make reforms—may become more involved in the company's operations.

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