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ALBANY, N.Y. - Soluna Holdings, Inc. (NASDAQ:SLNH) has secured at least $20 million in financing from Spring Lane Capital (SLC) for a 35-megawatt phase of Project Kati, the company’s second behind-the-meter data center project. The financing comes at a crucial time for the company, which InvestingPro data shows has been experiencing significant cash burn with a market capitalization of just $9.35 million.
According to a press release statement, Spring Lane Capital has entered into a term sheet to lead the financing round for the Bitcoin mining and AI-focused green data center. The companies also signed an agreement for SLC to extend up to $100 million in additional project-level capital for Soluna’s growing pipeline. With current annual revenue of $31.41 million and an EBITDA of -$39.51 million, this financing could be vital for the company’s expansion plans.
Construction on Project Kati 1 is expected to begin in Q3 2025, with initial energization targeted for Q1 2026. The facility is designed to accommodate approximately 12,000 next-generation Bitcoin mining rigs.
"Spring Lane Capital has been a trusted and strategic partner throughout our growth," said John Belizaire, CEO of Soluna Holdings. SLC is also an investor in Soluna’s Projects Dorothy 1A and Dorothy 2.
The financing will fully cover the project’s funding needs, including working capital. Project Kati 1 already has all necessary ERCOT planning approvals, with a model update to be submitted at least 90 days before energization.
SLC is deploying capital from its second private equity fund, which is twice the size of its initial fund. The fund is positioned to provide up to $4 million in Development Expenditure financing for Soluna’s long-lead equipment purchases.
Soluna develops green data centers for intensive computing applications, focusing on converting curtailed renewable energy into clean computing solutions. The company named Project Kati after Katalin "Kati" Karikó, the Hungarian scientist whose work made mRNA-based therapies and modern vaccines possible. InvestingPro analysis indicates the company faces significant financial challenges, with a weak overall health score of 1.44 out of 5 and a current ratio of 0.33. Subscribers to InvestingPro can access 13 additional key insights about Soluna’s financial position and market performance.
In other recent news, Soluna Holdings reported first-quarter revenue of $5.9 million and is actively expanding its green data center projects. The company has signed a term sheet for Project Annie, its first solar-powered data center, and secured land for Project Kati, a 166 MW development in Texas. Project Dorothy 2 has begun customer deployments, with 48 MW subscribed for future periods, and the first phase nearing completion. Soluna has also announced an at-the-market offering agreement with H.C. Wainwright & Co., potentially raising up to $3.75 million through the sale of common stock. Additionally, Soluna received a Nasdaq delisting notice for not meeting the minimum bid price requirement, with a compliance deadline set for November 4, 2025. The company has expressed its intention to monitor its stock price closely to address this issue. In Texas, Soluna is advancing Project Kati in partnership with EDF Renewables and Masdar, with construction set to commence with an 83 MW phase. Meanwhile, Project Sophie has achieved a record 1.0 EH/s in computing power, and the company continues to expand its partnership with Blockware.
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