LONDON (ShareCast) - (ShareCast News) - Technology investing company Vela has entered into a conditional agreement to invest £0.2m to acquire a minority equity stake in BlockchainK2, it announced on Friday.
The AIM-traded firm described BlockchainK2 as a cryptocurrency and blockchain platform that offered mining exposure and proprietary software-as-a-service (SaaS) blockchain solutions with "leading" industry partners.

It said the proposed investment would be funded from its existing cash resources.

"In November 2017 African Hydrocarbons announced that it would seek to complete a 'change of business' transaction pursuant to the policies of the TSX Venture Exchange, with the result that upon completion AHI would become a blockchain technology company with an initial focus on mining cryptocurrencies and be re-named BlockchainK2," Vela's board explained in its statement.

It said that change of business transaction was conditional on AHI raising gross proceeds of no less than CAD 2m, pursuant to a private placement, with Vela's proposed investment part of that.

Subject to certain conditions being met, including completion of AHI's private placement and the company meeting the applicable listing requirements of the TSX Venture Exchange as a technology issuer, it was expected that the change of business transaction would complete early next year.

"Upon completion of the change of business transaction AHI - to be re-named as BlockchainK2 - intends to acquire no less than CAD 1.3m worth of cryptocurrency mining equipment and employ such technology in a cryptocurrency mining data centre to be located in North America, to mine Bitcoin and other alternative cryptocurrencies."

The investment by Vela would be made into AHI, conditional on the change of business transaction completing, and on completion Vela would hold a minority equity stake in BlockchainK2.

Vela said the funds would be held in an escrow account, and if the change of business transaction was not completed then the proposed investment would not take place and funds would be returned to Vela.

"There can be no assurances that the change of business transaction and the proposed investment will be completed," Vela's board said.

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