Key Takeaways:
- Riot Platforms offers a $950 million buyout to Bitfarms, proposing a mix of cash and stock at a 24% premium.
- Bitfarms faces leadership turmoil, with the CEO’s departure and a subsequent lawsuit, while Riot plans governance reforms.
- The merger aims to create the largest publicly listed Bitcoin miner with substantial power and self-mining capacities by year-end.
Riot Platforms has announced a $950 million buyout offer for Bitfarms after a private proposal made in April was rejected.
Riot, already the largest shareholder with a 9.25% stake in Bitfarms, is offering a mix of cash and stock, valuing Bitfarms at a 24% premium over its recent share price.
Riot Proposes to Acquire Bitfarms for US$2.30 Per Share to Create the World’s Largest Publicly Listed Bitcoin Miner.
— Riot Platforms, Inc. (@RiotPlatforms) May 28, 2024
Read the full press release here: https://t.co/SnBijrL3i7
For disclaimers, please visit: https://t.co/6RQFSK9MKb.
Riot argues that the merger would create a stronger company with better financial and commercial prospects.
This offer comes as Bitfarms deals with leadership issues, including the departure of its CEO, Geoffrey Morphy, and his subsequent lawsuit against the company for breach of contract and wrongful dismissal.
Riot Platforms has taken a 9.25% stake in Bitfarms and plans to go public with a takeover offer for the smaller Bitcoin miner, sources say https://t.co/ekC6Rng9LQ
— Bloomberg Crypto (@crypto) May 28, 2024
Riot plans to address governance concerns at Bitfarms by proposing new independent directors at a special shareholders meeting.
Riot highlights Bitfarms’ underperformance in 2023, while Riot itself reported significant earnings growth in 2024.
As Bitfarms’ largest single shareholder, we are deeply concerned by the actions of their Board. Their entrenching behavior, the sudden termination of their CEO without a succession plan in-place during a critical period of execution and allegations made by their former CEO in a…
— Jason Les (@JasonLes_) May 28, 2024
If the merger succeeds, the combined entity would have the largest capacity of any publicly listed Bitcoin miner, with substantial power and self-mining capacities projected by the end of the year.
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