Riot Platforms Acquired 13% Stake in Bitfarms to Prevent Enemy Takeover
Riot Platforms is a company that deals with: cryptocurrency miningincreased its shares Bitfarms It owns 13.1% shares. This particular acquisition was revealed in a filing with the United States Securities and Exchange Commission on June 11. Riot acquired approximately six million common shares in three separate transactions for a total value of over $111 million.
Riot Objects to Bitfarms’ Takeover Defense Measures
Riot Platforms‘The hostile takeover approach was discovered when Bitfarms adopted its shareholder rights plan on June 10. The plan, sometimes known as a ‘poison pill’, aims to prevent a rival, in this case Riot, from trying to increase its ownership above the 15 per cent threshold by reducing shareholder value. Riot CEO Jason Les expressed concern about the move, stating that it deviates from “established legal and governance standards.” He also noted that the usual threshold for such actions is 20%, thus suggesting Bitfarms may have gone overboard with its defensive tactics.
Still, Bitfarms has justified itself by following Canadian securities laws, which means Riot can proceed with the acquisition. This situation created a lot of noise in the stock market, especially in the stock market. NasdaqBitfarms’ stock price is up over 56%.
Bitfarms CEO Resigns Amid Takeover Turmoil
The backdrop of this escalating takeover war at Bitfarms is accompanied by drastic changes in leadership. The company recently lost its CEO, Geoffrey Morphy, who resigned after the company was sued. Nicolas Bonta has since taken over as the current interim president and CEO. According to Riot, a major company, Les personally attacked Bonta and called for Bonta’s ouster due to alleged “bad corporate governance.”
This leadership conflict is a factor that further complicates an already complex acquisition story. Riot Platforms, which made a $950 million acquisition offer in May at a 24% premium over Bitfarms’ average share price, is now in a vulnerable position. The proposed acquisition is in line with Riot’s strategy to enhance its market position in the competitive cryptocurrency mining industry.
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Maxwell is a crypto-economic analyst and Blockchain enthusiast who is passionate about helping people understand the potential of decentralized technology. I write extensively on topics like blockchain, cryptocurrency, tokens, and more for many publications. My goal is to spread knowledge about this revolutionary technology and its effects on economic freedom and social well-being.
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