Bitcoin Miner Riot Seeks to Oust Bitfarms Board in Failed Hostile Takeover Attempt
Bitcoin mining giant Riot has announced that it is halting its hostile takeover bid of Canadian mining company Bitfarms. The decision comes after Bitfarms resisted the acquisition attempt and implemented a shareholder rights defense strategy to ward off the forced takeover. Riot has withdrawn its bid to acquire Bitfarms for $2.30 per share due to the opposition from Bitfarms and the successful implementation of the poison pill defense.
Instead of pursuing the takeover, Riot is now focusing on reshaping Bitfarms’ leadership to potentially facilitate a deal in the future. Riot aims to bring in new directors who may be more open to collaboration, referring to them as individuals with “fresh perspectives.”
Riot believes that a merger between Riot and Bitfarms could establish the largest publicly listed Bitcoin miner globally. However, the current situation with Bitfarms’ board has made engaging in discussions about a potential combination unfeasible.
Riot, as the largest shareholder of Bitfarms with a 14.9% stake, is shifting its strategy to address the leadership issues at Bitfarms. The company plans to replace Bitfarms’ current board members with new individuals, including John Delaney, Amy Freedman, and Ralph Goehring, in an effort to bring about change and potentially pave the way for a future deal.
Following the news, Bitfarms’ stock price dropped by nearly 9%, while Riot’s stock also saw a decline of almost 4%. The situation between Riot and Bitfarms has been marked by escalating tensions, with Riot initially attempting a hostile takeover and Bitfarms responding with defensive measures and strategic expansions.
Riot’s decision to withdraw its bid underscores the complexities and challenges involved in corporate mergers and acquisitions within the cryptocurrency mining industry. The evolving dynamics between Riot and Bitfarms highlight the competitive landscape and strategic maneuvers in the crypto mining sector.
