Zcash Miner Snags 9.4% of HeartSciences — Failed Deal Could Mean Liquidation
Fortitude Mining — the Zcash-focused mining arm tied to Digital Currency Group — quietly bought roughly 9.4% of HeartSciences in a private placement, handing over about $1 million to keep the company ticking while a planned merger waits for shareholder sign-off.
The quick rundown
On Aug. 12 Fortitude picked up 411,522 HeartSciences shares at $2.43 apiece, a deal that added up to about $999,998.46. That purchase price was roughly a 22% premium to the share price on the same day, and the money is earmarked for day-to-day operating costs — not as a loan.
Important technical bit: this cash buy sits outside whatever exchange-ratio math the proposed merger uses. In plain English, Fortitude bought ordinary shares but didn’t change the exchange rate or get extra closing shares for the $1 million infusion. So it’s equity in the target company, not additional merger consideration for Fortitude’s existing owners.
Why this matters (and why you should raise an eyebrow)
The proposed merger structure would leave Digital Currency Group with roughly 95% of the combined company’s voting power, and existing HeartSciences holders with only about 5% — subject to final calculations. As of late August the paperwork still had blanks where the meeting and record dates should be, and shareholder approval remains outstanding.
Here’s the spicy part: HeartSciences’ proxy warns that if the merger falls apart, the company may struggle to keep operating and could be forced to seek another buyer or strategic partner. If nothing viable shows up, liquidation is on the table — meaning common shareholders might walk away with nothing. Oof.
On Fortitude’s balance sheet, the company reported $8.5 million in adjusted EBITDA (a non-GAAP measure), but its GAAP results showed a $9.5 million net loss that included a $10.3 million write-down for mining equipment. So while adjusted numbers look tidy, the accounting paint job tells a more bruised story.
Bottom line: Fortitude’s million-dollar equity top-up keeps HeartSciences running for now, but it doesn’t erase the risk that the whole deal could flop. The next real milestone for shareholders is a definitive proxy that sets an official vote date — until then, drama and uncertainty reign. Grab popcorn.
