Olenox Surges 61% After Hours on CS Digital Data Center Deal
Benzinga reported Thursday that shares of Olenox Industries Inc. (NASDAQ: OLOX) rocketed more than 61% in after-hours trading after the company confirmed the closing of its acquisition of CS Digital Ventures, LLC, an energy-intensive digital infrastructure operator.
A $30M Deal Structured Around Gas and Compute
The Olenox data center acquisition was valued at $30 million. The transaction comprised $14 million in newly issued Series D Preferred Stock and a $16 million unsecured promissory note.
Sellers also received warrants covering 1.5 million OLOX shares. They remain eligible for up to $20 million in additional Series D Preferred Stock, contingent on post-closing revenue and EBITDA performance targets.
The combined entity brings together Olenox’s upstream natural gas assets and proprietary processing technology with CS Digital’s 35 megawatts of installed computing capacity. CS Digital posted $20.6 million in revenue and $6.2 million in EBITDA during 2025.
The Strategic Rationale: Power Costs as a Moat
The central thesis of the deal centers on electricity costs, not geography. According to an SEC filing, the merged platform targets all-in power expenses below $0.02 per kilowatt-hour for off-grid, gas-powered data centers.
Chairman and CEO Mike McLaren told investors that energy, not real estate, will be the binding constraint for compute infrastructure going forward. He said the platform is positioned to serve a wide range of energy-intensive customers.
That figure, if sustained at scale, would represent a substantial structural advantage over grid-connected facilities paying prevailing commercial electricity rates.
Background: A Deal That Shrank From Its Original Terms
The transaction has a shorter history than its ambition suggests. Olenox and CS Digital signed a non-binding letter of intent in April, initially structured as an all-stock merger worth up to $50 million. The final terms came in materially lower and shifted the consideration mix to include debt.
The revision is notable given Olenox’s current scale. The company carries a market capitalization of just $5.04 million. Its stock closed the regular Thursday session at $4.92, near a 52-week low of $4.10, down sharply from a 52-week high of $21.90. Over the trailing twelve months, OLOX has shed roughly 99% of its value.
What Investors Are Watching Now
The after-hours move pushed OLOX to approximately $7.96 per share, but the stock’s Relative Strength Index sat at 39.67 heading into the session, signaling weak near-term momentum before the announcement.
Investors will now focus on whether the combined platform can hit the revenue and EBITDA milestones that unlock the earnout provisions. Those targets will determine the deal’s true cost and the extent of further dilution.
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