Bitcoin miner IPO demands 99.8% of funds from public buyers while handing them just 10% equity

The deal has no firm close date and remains contingent on Nasdaq listing approval.

Existing holders would keep 90%, while AI Power X would retain 85.87% of voting power after the base offering.

Bitari’s preliminary IPO gives new investors 10% of post-offering shares for 99.8% of listed consideration.

Bitari Inc., a Bitcoin mining host pursuing a planned Bitcoin mining IPO and Nasdaq listing, is asking public buyers to provide nearly all of the consideration shown in its prospectus table while receiving about 10% of the company after the deal.

The company's preliminary S-1 proposes selling 4,285,715 shares at an expected $7 each, producing $30,000,005 of gross proceeds. The table counts that payment as 99.8% of total consideration and gives the new investors 10% of the 43,085,715 shares expected to be outstanding after the base offering.

The 99.8% figure compares consideration paid with shares owned rather than assigning enterprise value.

Existing stockholders would retain 38.8 million shares, or 90% of the post-offering total, after providing $45,000, or 0.2% of the consideration in the same table. On a per-share basis, Bitari calculates that the deal would raise net tangible book value from $0.06 to $0.69 while leaving buyers with immediate dilution of $6.31 on each $7 share.

The ownership gap also preserves control. AI Power X Inc. would hold 85.87% of the outstanding stock after the base offering. Chair Pei Zhao, the beneficial owner of those shares, would be able to exercise the same share of voting power, leaving Bitari a controlled company.

The proposed use of the new money adds a second layer to the structure. Bitari estimates about $26.95 million of net proceeds before any over-allotment and plans to direct 40%, about $10.78 million, to strategic acquisitions and investments. The company has yet to identify a target, enter preliminary negotiations or sign an acquisition agreement.

Another 30% is earmarked for global market expansion and brand development, with 15% for new mining operations and infrastructure, 10% for research and development, and 5% for general corporate purposes and working capital.

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Those proceeds would be material beside Bitari's recent operations. For the nine months ended April 30, revenue slipped to $8.37 million from $8.59 million a year earlier, while net income fell to $183,905 from $990,960. Operating activities used $689,760 of cash after generating $1.37 million in the comparable prior-year period.

The proposed structure remains contingent. Bitari has reserved the symbol BIAI and applied to the Nasdaq Global Market, but the filing says Nasdaq had not approved the application. Closing is conditioned on final listing approval, and the prospectus does not set a firm offering or trading date.

If it proceeds as described, buyers would be funding a controlled mining host through a Bitcoin mining IPO, while facing immediate accounting dilution and a large discretionary acquisition pool in exchange for roughly one-tenth of its post-offering shares.