Riot Platforms Plans Board Overhaul Amid Bitfarms Takeover Attempt
Summary:
Riot Platforms aims to replace three board members from Canadian mining company Bitfarms amidst a takeover attempt. Holding a 14.9% stake in Bitfarms, Riot announced it had withdrawn an offer to purchase all Bitfarms' shares at US$2.30 each after encountering resistance. Instead, it plans to negotiate with a restructured Bitfarms board to pursue a mutually beneficial merger. This maneuver is part of Riot's ongoing strategy to acquire Bitfarms, despite the company's 'poison pill' approach that caps holdings at 15%.
Riot Platforms, eyeing a takeover of Bitfarms, a Canadian mining corporation, aims to supplant three board of director members. Riot indicated in a public notice on June 24 that it owns approximately 14.9% of Bitfarms' shares. This follows Bitfarms' decision to institute a stockholder rights plan forbidding Riot from possessing more than 15% of its shares. Consequently, Riot decided to substitute three board members and expel any newly appointed director after this notice. Riot remarked, "Negotiations with Bitfarms' current board on a possible merger have proven unfeasible." The company notified Bitfarms' Board of its decision to retract its previous offer to buy all Bitfarms' shares at US$2.30 each and is prepared to initiate negotiations with a reconfigured Bitfarms board to discuss a mutually advantageous amalgamation with Riot. The three board members Riot aims to replace are John Delaney, Amy Freedman, and Ralph Goehring, individuals distinct and independent from both Riot and Bitfarms. Despite the takeover activities, Bitfarms' share price on Nasdaq surged over 36% in the preceding month. However, their stock value dipped about 6% within 24 hours. Bitfarms was contacted by Cointelegraph for a statement but didn't respond by the publication time. According to Riot, Bitfarm's board has been unresponsive to the takeover talks and criticized it for mishandling the CEO succession process. Ex-CEO of Bitfarms, Geoffrey Morphy, left the firm in May after suing the company. The current acting president and CEO, Nicolas Bonta, might be ousted as one of the board members if Riot convinces the shareholders. Riot's scheme to reconstruct Bitfarms' board is its most recent move in its strategy to acquire Bitfarms. In May, Riot proposed a $950 million deal to purchase the mining corporation and has been escalating its shares ever since Bitfarms set a limit through its 'poison pill' tactic, restricting any stocks at 15%.
Published At
6/24/2024 6:34:26 PM
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