SCHEDULE: Rumble Eyes Northern Data Acquisition for AI Cloud Push

Rumble announced its intent to acquire AI and HPC provider Northern Data through an all-stock exchange offer, aiming to become a global AI cloud leader.

Summary

• Rumble has informed Northern Data of its interest in a potential all-stock exchange offer for 100% of Northern Data's outstanding shares.
• Northern Data shareholders are expected to receive 2.319 newly issued Class A Rumble shares for each Northern Data share tendered.
• The Potential Offer would result in approximately 33.3% total pro forma ownership in Rumble for Northern Data shareholders, assuming all shares are tendered.
• Tether, Northern Data's majority shareholder (approximately 54% of outstanding shares), has indicated support for the Potential Offer.
• Following the transaction, Tether is expected to become the single largest holder of Rumble's Class A common stock, while Chris Pavlovski, Rumble's CEO, would retain majority voting power.
• The combined company aims to emphasize AI leadership, data privacy, and independence on a global scale.
• Rumble expects to integrate Northern Data's Ardent (data center business) and Taiga (GPU-as-a-service business) into its operations.
• Taiga possesses a significant number of Nvidia GPUs, including approximately 20,480 H100s and 2,048 H200s.
• Ardent and Northern Data Group own five data center sites with an energized capacity potential of nearly 850 MW, including a 180 MW site in Maysville, Georgia.
• Tether has committed to a multi-year agreement to purchase GPUs from Rumble following the completion of the transaction.
• The Potential Offer assumes Northern Data's Peak Mining unit would be disposed of prior to completion, with net proceeds used to reduce an existing loan from Tether; the remaining loan would be modified and remain Northern Data's obligation.

Sentiment

Score: 8

Explanation: The announcement outlines a highly strategic and potentially transformative acquisition for Rumble, backed by a major shareholder and customer commitment. While subject to standard M&A risks and conditions, the potential for significant expansion into the high-growth AI and HPC cloud market, coupled with substantial asset acquisition, indicates a strong positive outlook.

Positives

• The acquisition would fundamentally transform Rumble into a global AI cloud leader, significantly expanding its capabilities in AI and High Performance Computing (HPC).
• Rumble would gain substantial GPU assets, including 20,480 Nvidia H100s and 2,048 H200s, and nearly 850 MW of data center capacity.
• Tether, a major player in the digital assets industry, supports the offer and will significantly expand its investment in Rumble, demonstrating strong conviction.
• Tether has committed to becoming an important customer of Rumble post-acquisition, with a multi-year commitment to purchase GPUs, providing a stable revenue stream.
• The transaction aligns with a shared vision to democratize compute and provide unfettered access to infrastructure, leveraging Rumble's existing high-growth cloud business.
• The potential sale of Northern Data's Peak Mining unit would reduce existing debt, improving the financial health of the acquired business.

Negatives

• The Potential Offer is not a final decision and is subject to numerous conditions, including confirmatory due diligence, definitive documentation, and various approvals.
• There is no guarantee that the Potential Offer will be launched or completed, or that Tether or other key shareholders will ultimately agree to support it.
• The final exchange ratio and other terms of the Potential Offer may differ substantially from those initially set out.
• Rumble has little prior experience operating in Northern Data's specific new business lines (AI/HPC cloud services), which could pose integration and operational challenges.
• The transaction involves potential costs and risks of litigation, as well as the assumption of actual or contingent liabilities by Rumble.
• The announcement could affect Rumble's or Northern Data's relationships with employees, business partners, or governmental entities.

Risks

• Rumble may decide to materially alter the terms of the Potential Offer or elect not to pursue it at all, based on confirmatory due diligence.
• The steps required to launch the Potential Offer, including reaching definitive agreements with Northern Data, Tether, and other third parties, may not be completed on a timely basis or at all.
• Northern Data, Tether, or other key shareholders are not legally committed to the proposed transaction and may pursue other alternatives.
• The conditions to launching the Potential Offer, such as approvals from Rumble's and Northern Data's boards, may not be satisfied.
• Even if definitive agreements are entered into, closing conditions (e.g., minimum tender, regulatory approvals) may not be met.
• Rumble may not realize the potential benefits of the Potential Offer, including due to lack of experience in new business lines or insufficient capital to grow the acquired business.
• The transaction could be impacted by broader industry, economic, or political conditions outside of the companies' control.
• Litigation may arise as a result of the proposed transaction.
• Rumble may assume actual or contingent liabilities as a result of the proposed transaction, if completed.

Future Outlook

Rumble anticipates that the Potential Offer, if completed, will fundamentally transform the company into a global AI cloud leader. The integration of Northern Data's data center and GPU-as-a-service businesses is expected to significantly expand Rumble's offerings. Tether is projected to become a key customer, committing to multi-year GPU purchases, further solidifying the combined entity's position in democratizing compute and providing unfettered access to infrastructure.

Management Comments

• Chris Pavlovski, Rumble's Chairman and CEO, has indicated his support for the Potential Offer and would agree to vote all of his Rumble shares in favor of the transaction.
• Tether's $775 million investment in Rumble in February 2025 was predicated on the mutual desire to challenge big tech in all areas, with a deep focus on video and cloud.

Industry Context

This announcement positions Rumble to significantly expand its footprint in the rapidly growing AI and High-Performance Computing (HPC) cloud market. By acquiring Northern Data's substantial GPU assets and data center infrastructure, Rumble aims to directly compete with larger, established cloud providers and address the increasing demand for compute power driven by AI development. The emphasis on 'freedom-first infrastructure' and 'democratizing compute' aligns with a broader industry trend seeking decentralized and privacy-focused alternatives to traditional 'big tech' platforms.

Comparison to Industry Standards

• The acquisition of 20,480 Nvidia H100s and 2,048 H200s would significantly elevate Rumble's GPU compute capacity, placing it among the more substantial emerging providers in the specialized AI cloud market. For context, while hyperscalers like Amazon Web Services (AWS) or Microsoft Azure operate at a much larger scale, this asset base is competitive with dedicated AI infrastructure providers such as CoreWeave or Lambda Labs, which focus on high-demand Nvidia GPUs.
• Northern Data's nearly 850 MW of energized data center capacity potential, including a 180 MW site in Maysville, Georgia, represents a considerable infrastructure footprint. This capacity is comparable to the portfolios of mid-to-large-tier data center REITs or specialized colocation providers, indicating a significant scale for supporting high-density AI workloads.
• The strategic partnership with Tether, a major entity in the digital assets space, and its commitment to multi-year GPU purchases, provides a unique competitive advantage. This type of anchor client commitment is highly valuable in the capital-intensive data center and GPU cloud industry, offering a stable demand base that many new entrants lack.

Legal Proceedings

• In October 2021, the U.S. Commodity Futures Trading Commission (CFTC) instituted and settled regulatory proceedings against Tether Holdings, S.A. de C.V. and related entities, resulting in a $41 million civil monetary penalty for alleged untrue or misleading statements regarding USDT backing.
• In February 2021, the Office of the Attorney General of the State of New York (NYAG) settled a 2019 proceeding with Tether and several Bitfinex companies, resulting in an $18.5 million penalty and requirements to discontinue trading activity with New York persons/entities and submit to mandatory reporting.

Related Party Transactions

• Tether, the majority shareholder of Northern Data, is also a significant investor in Rumble, having made a $775 million investment in February 2025.
• Following the potential acquisition, Tether is expected to become the single largest holder of Rumble's Class A common stock.
• Tether has extended a loan to Northern Data, which is expected to be reduced by proceeds from the Peak Mining sale and then modified, remaining an obligation of Northern Data.
• Tether has committed to becoming an important customer of Rumble post-acquisition, with a multi-year commitment to purchase GPUs.

Stakeholder Impact

• **Rumble Shareholders**: Potential for significant long-term growth and market expansion into the high-demand AI and HPC cloud sectors, but also potential share dilution from the all-stock offer and integration risks.
• **Northern Data Shareholders**: Opportunity to exchange their shares for Rumble Class A common stock, gaining exposure to a U.S. publicly traded company and a potentially larger, more diversified entity.
• **Employees (Northern Data)**: Integration into a larger, strategically expanding company, potentially offering new career opportunities within the combined entity.
• **Customers (Rumble/Northern Data)**: Access to a significantly expanded suite of cloud services, particularly in GPU-as-a-service and data center capacity, potentially leading to more robust and diverse offerings.
• **Tether**: Strengthens its strategic partnership with Rumble, significantly expands its investment, and secures a multi-year GPU purchase agreement, aligning with its goal to challenge 'big tech'.

Next Steps

• Rumble must conduct and complete confirmatory due diligence on Northern Data to its sole satisfaction.
• Rumble and Northern Data need to negotiate and enter into definitive transaction agreements.
• The Potential Offer and related documentation require approval from Rumble's Board of Directors.
• Tether and potentially other key shareholders must enter into a sale and purchase agreement with Rumble for their Northern Data shares.
• Tether needs to agree to amend the shareholder loan granted to Northern Data on mutually acceptable terms.
• Northern Data's management board and supervisory board must agree to recommend the Potential Offer to their shareholders.
• BaFin (German Federal Financial Supervisory Authority) must approve the prospectus relating to the public offer of Rumble shares.
• Certain regulatory approvals will be required to complete the Potential Offer.

Key Dates

Recommendation

This proposed acquisition represents a transformative strategic move for Rumble, positioning it as a significant player in the high-growth AI and HPC cloud market. The acquisition of substantial Nvidia GPU assets (H100s, H200s) and extensive data center capacity provides a strong foundation for future revenue streams. The strong backing from Tether, a major digital assets company, not only de-risks the transaction but also guarantees a significant customer commitment post-acquisition. While subject to due diligence and regulatory approvals, the stated intent and terms are highly favorable, indicating a clear path to enhanced competitive advantage and long-term value creation.

Keywords

Rumble, Northern Data, AI, HPC, High Performance Computing, GPU, Data Center, Acquisition, Exchange Offer, Tether, Cloud Services, Video Sharing, Infrastructure, Nvidia, H100, H200