Empery Digital Inc. (NASDAQ:EMPD) said it will make a $65 million equity investment to acquire a 25% interest in a private entity that is purchasing a Midwest facility intended for conversion into an AI data center. The company reported the investment in a filing that also noted the transaction is expected to close in the third quarter of 2026, subject to customary closing conditions.
In pre-market trading on Tuesday, Empery Digital shares fell 3.8% following the announcement. The company’s public disclosure described the asset as a site that has operated as a power-intensive industrial facility for the past three years and which includes an owned substation.
The site currently has infrastructure supporting roughly 150 megawatts of available power capacity. A recent load study commissioned for the project confirmed that the facility could be expanded - nearly doubling available power to about 300 megawatts to support AI workloads.
Empery Digital and Hunt Properties have agreed to a strategic partnership to jointly originate, evaluate, and acquire powered land parcels that have secured tenants and are suitable for AI and high-performance computing data center development. The filing states that an affiliate of Hunt Properties, which is the managing member of the private entity buying the site, has executed a non-binding letter of intent to finalize a triple net lease with a leading provider of compute. That tenant would be servicing a global leader in AI computing hardware, and the lease could potentially generate payments totaling $1 billion.
Separately, Empery Digital said it will discontinue its treasury dashboard. The company explained that reporting company net asset value based solely on its Bitcoin holdings no longer fully reflects the company’s total net asset value.
The company disclosed advisors on the transaction. Clear Street acted as financial advisor and Ropes & Gray LLP served as legal counsel to Empery Digital. Lake Street Capital Markets acted as financial advisor to the acquiring entity, and Davis Polk & Wardwell LLP served as legal counsel to that entity.
Summary
Empery Digital will invest $65 million for a 25% stake in a private vehicle acquiring a Midwest industrial site to convert into an AI data center, with the deal expected to close in Q3 2026. The site currently supports about 150 MW and may be expanded to roughly 300 MW. The announcement coincided with a 3.8% pre-market decline in Empery shares.
- Key points:
- Investment size and ownership: $65 million for a 25% stake in the acquiring entity.
- Site power profile: approximately 150 MW presently available, with a load study indicating near-term expansion potential to about 300 MW.
- Strategic arrangement: partnership with Hunt Properties to pursue powered land opportunities for AI and HPC tenants; a potential triple net lease could yield up to $1 billion in payments.
- Risks and uncertainties:
- Closing conditions: the investment is expected to close in Q3 2026 but remains subject to customary closing conditions.
- Non-binding LOI: the letter of intent for the triple net lease is non-binding, and the lease terms and payments are not guaranteed.
- Asset conversion: converting a power-intensive industrial facility into an AI data center depends on successful permitting, construction and tenant agreements, which may affect timing and economics.