The video platform Rumble seeks to expand its AI cloud computing capabilities with the complete stock swap deal.
Rumble, a competitor of YouTube and one of the technology companies holding Bitcoin, has announced plans to acquire two key business segments of Northern Data – a German company controlled by the stablecoin issuer Tether. This 1.17 billion USD deal marks a significant step in Rumble's expansion strategy into the cloud computing and artificial intelligence fields.
According to the announcement on Monday, Rumble proposed to acquire Northern Data's Taiga cloud business and the large-scale Ardent data center business through a complete stock swap transaction. This move aims to enhance competitiveness in the booming AI cloud computing market, where the demand for GPU services and high-performance computing infrastructure is increasing.
At the same time, Northern Data also announced the sale of its cryptocurrency mining segment Peak Mining to the private Bitcoin mining company Elektron Energy for 235 million USD, indicating a strategic restructuring to focus on core business segments.
Support from Tether and long-term commitment
A notable point of this deal is the strong backing from Tether, the owner of Northern Data. Rumble stated that after the transaction is completed, Tether will become a significant customer with a commitment to purchase GPUs for many years to come. This not only ensures a stable revenue stream for Rumble but also strengthens the strategic partnership between the two parties.
This relationship was established last year when Tether announced a plan to invest 775 million USD in the Rumble platform, starting with a cash infusion of 250 million USD. Tether, based in El Salvador, is the issuer of USDT – the fourth largest stablecoin in the world by market capitalization, which is pegged to and backed by the USD.
Rumble, a Canadian company listed on Nasdaq with the ticker RUM, has positioned itself as an alternative video-sharing platform to YouTube, particularly appealing to conservative content creators in the U.S. through its advocacy for free speech. The platform has also demonstrated its commitment to digital assets by incorporating Bitcoin into its balance sheet since last year and currently holds 210.8 BTC, equivalent to more than 25 million USD at current prices.
Although RUM shares rose about 3% in Monday's trading after the announcement, the stock price is still down about 34% from the beginning of the year, reflecting the common challenges that technology companies face in the current market environment.
