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Northern Data sold Peak Mining to entities tied to Tether executives without related-party disclosure obligations

Failed $235M August deal with Devasini-controlled Elektron preceded a lower-valued sale to new linked buyers

Mining divestment came just before Rumble acquisition and amid VAT fraud probes in Germany and Sweden

Northern Data, a German AI and data center company majority-owned by Tether, has sold its Bitcoin (CRYPTO: $BTC ) mining subsidiary Peak Mining for up to $200 million to a group of companies linked to Tether's senior leadership, according to corporate filings reviewed by the Financial Times.

The transaction, announced by Northern Data in November, involved the sale of Peak Mining to Highland Group Mining Inc., Appalachian Energy LLC, and 2750418 Alberta ULC. While the buyers were not initially disclosed, subsequent filings tied the entities directly to Giancarlo Devasini, Tether's co-founder and chairman, and Paolo Ardoino, the company's chief executive officer.

Records from the British Virgin Islands indicate that Devasini and Ardoino control Highland Group Mining. Canadian filings list Devasini as the sole director of 2750418 Alberta ULC. Meanwhile, the ownership structure of Appalachian Energy LLC, which is registered in Delaware, remains undisclosed, with no publicly listed directors.

Northern Data is listed on a regulated but unofficial segment of the German market. While the framework requires certain corporate disclosures, it does not mandate reporting of related-party transactions, meaning the company was not obligated to disclose that executives linked to its majority shareholder were involved on both sides of the deal.

Second Attempt Follows Failed August Agreement

The Peak Mining sale marked Northern Data's second effort in 2024 to divest the mining unit to Devasini-linked entities. In August, the company announced a nonbinding agreement to sell Peak Mining to Elektron Energy for $235 million.

British Virgin Islands filings show Devasini also controls Elektron Energy. That transaction did not close, and the mining business was later sold at a lower valuation to the three companies identified in recent filings.

Transaction Timing Overlaps Rumble Acquisition

The divestment occurred shortly before Rumble, in which Tether holds a 48% stake, agreed to acquire Northern Data for approximately $767 million. Under the terms of that business combination, Tether committed to purchase $150 million in GPU services from Rumble and entered into a separate $100 million advertising agreement.

Tether has also extended a €610 million loan to Northern Data. According to the transaction structure, half of that loan will convert into Rumble equity upon closing. At the same time, the remainder will be restructured as a new loan from Tether to Rumble, secured by Northern Data's assets.

Ongoing Regulatory Scrutiny

The Peak Mining transaction unfolded amid heightened regulatory scrutiny of Northern Data. In September, authorities in Germany and Sweden raided the company's offices as part of an investigation into alleged large-scale VAT fraud that could exceed €100 million.

Northern Data denied wrongdoing, stating the investigation stemmed from a misunderstanding related to the tax treatment of its GPU cloud services and legacy mining operations. Separately, a lawsuit filed in April 2024 by former U.S. executives alleging tax and liquidity issues was voluntarily dismissed in October, with no settlement details disclosed.