Riot Platforms and Bitfarms Reach Agreement to End Acquisition Offer

VaselineSeptember 23, 2024

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Riot Platforms and Bitfarms Reach Agreement to End Acquisition Offer

Key recommendations

Riot Platforms withdraws Bitfarms acquisition offer as part of settlement agreement.
The Bitfarms board undergoes changes with a resignation and a new appointment.

Bitcoin mining firms Riot Platforms and Bitfarms have reached a settlement agreement, ending Riot’s takeover bid for the crypto mining company, according to a September 23 statement.

As a result, Riot Platforms withdrew its request for the Bitfarms special meeting of shareholders. The agreement, signed on September 23, 2024, maintains Riot’s 19.9% stake in Bitfarms, consisting of 90,110,912 common shares.

Additionally, as part of the settlement, Andrés Finkielsztain resigned from Bitfarms’ Board of Directors, while Amy Freedman was appointed to the board and several committees.

Amy has 25 years of experience in corporate governance and public capital markets, currently holding an advisory role with Ewing Morris and Co. Investment Partners and with a background in companies such as Stifel Financial Corp. and Morgan Stanley, according to Bitfarms. .

The agreement includes the appointment of Freedman to the Governance and Nominating Committee and the Compensation Committee. He will also join any current or future “special committees” of independent directors, provided he meets the independence requirements.

Riot Platforms said it will continue to review its investment in Bitfarms and may adjust its position based on various factors, including market conditions and other investment opportunities.

The end of a hostile takeover

Riot Platforms stepped up its stake as a shareholder in Bitfarms in 2024, along with a $950 million bid to buy the company in April.

This relationship has resulted in a back and forth between both companies. Bitfarms has tried to stop Riot’s attempts with a plan to sell shares at a discount to shareholders seeking to increase their stake in the company, up to a 15% threshold.

Accordingly, Riot took this approach by suggesting three independent candidates for Bitfarms’ board of directors.

Bitfarms then called a “special meeting of shareholders” to discuss Riot’s efforts to acquire the company.

Thus, the current settlement puts an end to hostile takeover attempts by Riot.