Bitfarms Fortifies Board Amid Riot's Hostile Takeover Bid; Hut 8 Lands Major Investment
Summary:
Bitfarms, one of Canada's leading Bitcoin mining firms, has appointed a new board member in a strategic move against a potential hostile takeover by Riot Platforms. Riot, who unsuccessfully attempted to raise their ownership share above 15%, intended to replace three of Bitfarms' board members with independent directors. These developments amidst rising investor interest in Bitcoin and AI computational power also saw Bitcoin mining firm, Hut 8, securing a significant $150 million investment from billionaire Philippe Laffont's Coatue Management.
In the heating rivalry between leading Bitcoin mining entities, Riot Platforms and Bitfarms, an additional board member has been enlisted by Bitfarms to prevent what seemed to be a "hostile takeover." On the 24th of June, Riot Platform, which currently holds a 14.9% share in Bitfarms, disclosed its resolve to substitute three of Bitfarms’ board members with independent directors. Such action is in reaction to the current board members blocking Riot’s bid to expand its ownership beyond 15%.
Riot had inadvertently resiled from its preliminary proposal to purchase all Bitfarms common stocks at a rate of US$2.30 per share, making it known that “[It] is clear that engaging with the incumbent Bitfarms Board on a potential combination is just not possible.”
Three days later, on June 27, the Canadian Bitcoin mining company, Bitfarms, introduced Fanny Philip as an independent board member. Subsequent to Philip's enlistment, the majority of the board members, four out of five, are independent. This contrasts with Riot's aim to substitute the primary board members with a team of three individuals "entirely independent of Riot and Bitfarms", namely John Delaney, Amy Freedman and Ralph Goehring.
Philip is an affiliate of the Canadian Blockchain Consortium’s mining commission and the leader of its Québec Chapter. Riot Platforms refrained from responding to Cointelegraph’s request for a statement.
Related: Record Q1 net income of $211M reported by Bitcoin miner Riot Platforms
With the rising curiosity in artificial intelligence and mainstream acceptance of Bitcoin, investors are eagerly investing in Bitcoin mining firms due to the escalating necessity for computational power. A direct result of this demand resulted in Bitcoin mining operation, Hut 8, acquiring a $150 million investment from billionaire Philippe Laffont's Coatue Management on June 24.
Regarding the $150 million investment, Laffont stated that Hut 8 was suitably positioned to hasten new computation capacity and to exploit any resulting opportunities. "We are devoted to backing inventors progressing AI and are confident that computation capacity is pivotal for triggering notable growth across the ecosystem."
The finalisation of this transaction is anticipated on or prior to July 11 this year. On June 21, Hut 8 lodged the investment agreement involving Coatue with the US Securities and Exchange Commission. Hut 8, one of the most significant public mining establishments in terms of computing power, is currently valued at a market capital of $1.1 billion.
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Published At
6/28/2024 11:11:00 AM
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