Rumble Considers Acquiring German Data Center Company Northern Data, Valuing Nearly $1.2 Billion

Rumble (RUM.US), a US video platform and cloud services provider, is considering acquiring German data center company Northern Data AG in an all-stock transaction valuing the latter at approximately $1.17 billion. The two parties stated in statements on Sunday and Monday that Rumble has proposed exchanging 2.319 newly issued Rumble shares for each Northern Data share.

The offer values Northern Data at approximately $18.27 per share, a significant discount to its closing price of €23.02 (US$26.81) on Friday. Upon completion of the transaction, Northern Data shareholders would own approximately one-third of the combined company.

Based on the companies' latest market capitalizations, the merger would create a company valued at approximately $4.5 billion. However, this valuation represents a significant discount to the $16 billion valuation Northern Data had previously sought for its combined AI cloud and data center businesses in its US IPO. Last year, the company held discussions with advisors about listing its Taiga and Ardent businesses.

Northern Data began as a cryptocurrency mining company but later shifted its focus to serving businesses developing artificial intelligence tools to capitalize on the sector's massive demand for computing power. Rumble, aiming to go public in 2022, recently entered the cloud market, seeking to compete in an industry dominated by well-funded Silicon Valley giants. The company launched cloud services for other businesses last year.

According to the statement, Tether, a privately held digital asset company and controlling shareholder of both companies, supports the transaction. Tether invested in Northern Data early last year and took a stake in Rumble in February of this year.

Furthermore, according to Rumble, the transaction assumes Northern Data will complete the sale of its cryptocurrency mining business. In a separate statement on Monday, Northern Data said it had signed a non-binding agreement with Elektron Energy LP to sell its Bitcoin mining unit.