Olenox Industries (NASDAQ: OLOX) announced the closing of its acquisition of CS Digital Ventures LLC, launching an energy-led digital infrastructure platform designed to convert low-cost natural gas into compute at the point of generation. The transaction positions the company to develop off-grid, gas-powered data centers with all-in power costs below $0.02 per kWh to support AI and other high-performance compute workloads.
The acquisition included $30 million in upfront consideration, comprised of $14 million in Series D Preferred Stock and a $16 million unsecured promissory note, along with warrants to acquire 1.5 million shares of Olenox common stock. The deal also includes the potential for an additional $20 million in milestone-based preferred stock consideration. The combined platform pairs Olenox's upstream natural gas position, midstream capabilities and proprietary processing technology with CS Digital's expertise in operating institutional-scale, energy-intensive data centers.
CS Digital contributes approximately 35 MW of installed operating power capacity, with projected 2025 revenue of $20.6 million and projected 2025 EBITDA of $6.2 million. This acquisition is a significant step for Olenox as it moves into the high-growth digital infrastructure sector, leveraging its energy assets to provide low-cost power for data centers. The ability to generate power at the source of natural gas production could reduce transmission costs and improve efficiency, offering a competitive edge in the rapidly expanding AI compute market.
The importance of this announcement lies in the convergence of energy and digital infrastructure. As AI and high-performance computing demand skyrockets, power costs become a critical factor. Olenox's model of using natural gas for on-site power generation could disrupt traditional data center economics, which often rely on grid electricity. This vertical integration from gas production to compute output may also help address energy security and grid reliability concerns.
For investors, the acquisition provides Olenox with a new revenue stream and exposure to the booming AI infrastructure market. The company's ability to execute on this strategy could significantly impact its valuation and growth trajectory. The broader industry may see similar moves as energy companies seek to capitalize on the digital economy's power needs.
To view the full press release, visit https://ibn.fm/OcULR. For the latest news and updates relating to Olenox Industries, visit the company's newsroom at https://ibn.fm/OLOX.
