Cryptomining firm Hyper Bit Technologies has signed a letter of intent to buy Dogecoin Mining Technologies, a startup focused on mining Dogecoin (DOGE) and Litecoin (LTC).

The company this week announced it has signed a non-binding agreement to purchase Dogecoin Mining Technologies in a structured deal that will include an 11MW data center hosting facility based in Canada, along with a minimum of 2,000 ElphaPex DG2 mining rigs.

Details on the data center weren't shared.

The purchase will be completed using 15 million of Hyper Bit's own shares, valuing the deal at $4.5 million.

The transaction is expected to be executed upon the completion of five milestones based on time passing (four months after the deal closes), the arrival of hardware, the installation and activation of hardware, the achievement of expected mining performance, and the allocation of a minimum of 2,000 mining rigs.

Canadian firm Hyper Bit aims to become one of the first publicly listed altcoin mining companies, and has identified both Dogecoin and Litecoin as potentially profitable altcoins that can be predicted to follow a close correlation with Bitcoin.

“We view Dogecoin and Litecoin as uniquely compelling assets, offering robust mining economics and significant upside potential, particularly due to their strong correlation with Bitcoin price trends,” said Hyper Bit COO, Cole Goodwin.

“We are excited to partner with the Dogecoin Mining Technologies team, whose extensive expertise and industry connections are anticipated to add substantial strategic value to Hyper Bit,” Goodwin added.

Hyper Bit has still to negotiate a final agreement, do due diligence, get a valuation, and get approval from the stock exchange.

“We are excited by the opportunity to merge our efforts with the team at Hyper Bit, who shares our focus on Dogecoin's strong economic potential in today's competitive landscape,” said Dogecoin Mining president, Carl Hermansen, adding: “Pending capital allocation, our platform is ready for immediate launch and scalable growth."

Hyper Bit Technologies Ltd. is publicly listed on the Canadian Securities Exchange, Frankfurt Stock Exchange, and OTC Market.

Originally founded in 2018 as a hemp company known as Hemp for Health Inc., the company rebranded to Yellow Stem Tech Inc. and then Sweet Poison Spirits Inc., before finally taking the Hyper Bit name earlier this year. It first moved into the crypto space in 2022, acquiring 150 SC200 mining rigs with the intention of mining Siacoin and converting them to Bitcoin, but they were still undeployed as of January this year.

The company had entered into an agreement to operate the rigs with a third party, but after a major drop in the cryptocurrency market, it was not profitable to place the SC200 rigs into production. After a brief pivot to become a tequila distribution firm, the company pivoted back to crypto, acquiring ten 530W Goldshell AE-BOX II miners and taking on the Hyper Bit moniker in March. The company has since acquired up to 35 ElphaPex DG1+ crypto ASICs for mining of Dogecoin and Litecoin.