A fierce battle for control is brewing between two Bitcoin mining companies, as Canadian miner Bitfarms accuses Colorado-based Riot Platforms of launching a hostile takeover bid.
Riot Platforms made an initial offer of $950 million on May 28, based on Bitfarms’ average share price for the month up to May 24, 2024. However, Bitfarms shareholders were not pleased with the idea of giving up more than 15% of their ownership in a potential takeover. In response, Riot Platforms went ahead and purchased around six million common shares of Bitfarms for $111 million in June, increasing its stake in the company to 13.1%.
Bitfarms condemned this move by Riot Platforms, calling it an effort to disrupt the acquisition process. Despite this, Bitfarms did not provide immediate comment when approached by Cointelegraph for a response.
In light of these developments, Bitfarms’ special committee, made up of independent directors, concluded that Riot’s offer significantly undervalued the company and was not in the best interest of shareholders. As a result, Bitfarms implemented a shareholder rights plan on June 10 to safeguard against any unwanted takeover attempts by Riot Platforms.
Bitfarms operates 12 Bitcoin mining facilities across Canada, the United States, Paraguay, and Argentina. In a separate development, the company’s former CEO, Geoffrey Morphy, announced his resignation after taking legal action against Bitfarms. Nicolas Bonta has since taken on the role of interim president and CEO, with calls from some quarters for his removal due to alleged corporate governance issues.
In the midst of this power struggle, it is clear that the battle for control between Bitfarms and Riot Platforms is far from over, with both sides fiercely defending their interests in the high-stakes world of Bitcoin mining.