Riot Platforms has decided to abandon its bid to acquire rival Bitfarms. Instead, it seeks to overhaul Bitfarms‘ Board of Directors before considering further takeover attempts.
On June 24, Riot formally requested a special meeting of Bitfarms shareholders to restructure the board by removing Bitfarm Chairman and Interim CEO Nicolas Bonta and director Andrés Finkielsztain. The final decision will be made via a shareholder vote.
The voting will also decide whether to remove anyone appointed to fill the vacancy left by co-founder Emiliano Grodzki, who was recently removed from the board at the annual shareholders’ meeting. Bonta and Grodzki co-founded Bitfarms in 2017.
Riot stated that this move is necessary due to stalled negotiations with Bitfarms’ board. It explained that its efforts to engage in good-faith negotiations with the board would not be possible without significant changes.
According to the firm:
“The culture of the current Bitfarms Board is founder-driven, and Riot believes it prioritizes the interests of individual directors over what is best for Bitfarms and its shareholders.”
As a result, Riot is nominating John Delaney, Amy Freedman, and Ralph Goehring to replace the current Bitfarms board members. It added:
“None of these nominees is receiving any compensation or other financial benefit from Riot or any of Riot’s advisors, either directly or indirectly, related to Riot’s requisition of the Special Meeting or in connection with serving as a nominee or director of Bitfarms.”
Riot initially attempted to acquire Bitfarms in April for approximately $950 million. However, Bitfarms rejected the unsolicited offer and said it significantly undervalued the firm. Since that deal fell through, Riot has steadily purchased Bitfarms stock, becoming its largest shareholder with a 14.9% stake in the miner.
Riot said it is ready to discuss a potential acquisition with a reconstituted Bitfarms board but has withdrawn its previous offer of $2.30 per share.
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