Bitfarms pushes back against Riot’s $950M takeover attempt
The latest ownership war is heating up between two Bitcoin mining companies, with Canadian Bitcoin miner Bitfarms trying to take control of Colorado-based Riot Platform.
In its initial proposal on May 28, Riot Platforms proposed a $950 million acquisition of Bitfarms' one-month volume-weighted average share price starting May 24, 2024.
However, Bitfarms shareholders were disappointed that their stake in the corporate raid was over 15%. Shortly thereafter, in June, Riot announced that it had purchased approximately six million shares of BitFarm common stock for $111 million.
Building on its previous holdings, Riot acquired a 13.1% stake in Bitfarms. BitFarms said the move was an “attempt to undermine the integrity of the procurement process”. Bitfarms said:
“It is clear that Riot's interests are not aligned with those of BitFarms shareholders, and instead of participating in good faith in the Special Committee process, Riot is attacking the BitFarms Board and corporate management to push for a low-ball bid and obstruct the strategic options review process.”
BitFarms did not immediately respond to Cointelegraph's request for comment.
Related: Bitcoin Mining Riot Platforms Reports $211M Q1 Net Income
Bitfarms' special committee will consider the unsolicited proposals and “consist of independent directors who have determined that the proposal would materially dilute Bitfarms and not be in the best interests of shareholders.”
On June 10, Bitfarms adopted its shareholders' rights plan to prevent an “unsolicited takeover bid” from Riot Platforms.
Bitfarms said it believed the disclaimer was in the best interest of its shareholders and Riot intended to make the decision “short-circuit”.
Bitfarms operates 12 Bitcoin (BTC) mining facilities in four countries: Canada, United States, Paraguay and Argentina. In May, Bitfarms announced that former CEO Jeffrey Murphy would step down after filing a lawsuit against the mining company.
Nicholas Bonta has been serving as interim president and CEO until the company decides on a replacement for Morphine. Les Bonta asked the board to remove him saying that he is “directly responsible”. [Bitfarms’] Poor Corporate Governance Practices”.
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