Bitcoin miner Riot Platforms (RIOT) has decided to abandon its proposal to buy peer Bitfarms (BITF) and instead focus on restructuring the board before making any further takeover attempts. The decision came after more than a year of unsuccessful negotiations with the Bitfarms Board. Riot believes that real change in the Bitfarms boardroom is necessary in order to facilitate productive discussions about a potential combination of the two companies.
Riot is now looking to nominate three new board members – John Delaney, Amy Freedman, and Ralph Goehring – to replace the current members of Bitfarms. The miner, which currently holds 14.9% of Bitfarms’ shares, is calling for a special meeting to remove Bitfarms’ Chairman and interim CEO Nicolas Bonta, director Andrés Finkielsztain, and anyone who might fill the vacancy left by the resignation of co-founder Emiliano Grodzki. Riot also plans to remove any additional director appointed by the current Bitfarms board after a certain date.
The hostile takeover bid by Riot was made public last month when the company offered to buy Bitfarms for $2.30 per share, a proposal that was quickly rejected by Bitfarms. Despite the rejection, Riot continued to purchase shares of Bitfarms in an attempt to pressure the board into engaging with them. In response, Bitfarms implemented a shareholder rights plan, also known as a “poison pill,” to discourage Riot from acquiring the company.
Riot remains committed to pursuing a takeover of Bitfarms as they believe that a combination of the two companies would create the world’s largest publicly listed bitcoin miner with strong potential for long-term growth. Although Bitfarms shares fell over 6% following Riot’s announcement, the stock is still trading above the $2.30 per share buyout offer, indicating that traders still view Bitfarms as a potential takeover target. Meanwhile, Riot’s shares experienced a slight dip as the price of bitcoin dropped by 3% in the last 24 hours.
In conclusion, Riot’s decision to shift its focus towards restructuring the Bitfarms board and pursuing a takeover comes after unsuccessful attempts at negotiating a potential combination of the two companies. The proposed changes to the Bitfarms board, along with Riot’s continued efforts to acquire the company, indicate that the battle for control is far from over. As both companies navigate these developments, the future of Bitfarms and its potential acquisition by Riot remains uncertain, with the outcome likely to have significant implications for the cryptocurrency mining industry.