Riot’s executive chairman and CEO expressed apprehension regarding the proposed acquisition of Stronghold Digital and the recent governance changes at Bitfarms on Tuesday.
The months-long takeover conflict between bitcoin miners Riot Platforms and Bitfarms is still characterized by mudslinging.
In anticipation of a special meeting to vote on the reconstitution of Bitfarms’ board of directors, Riot Executive Chairman Benjamin Yi and CEO Jason Les expressed apprehension regarding the company’s recent governance changes and the proposed acquisition of Stronghold Digital on Tuesday.
In a letter, Yi and Les stated that Bitfarms requires additional directors who are truly independent and possess the necessary experience and expertise to guarantee that the company’s future strategy is in the best interest of all shareholders, rather than merely the legacy directors who are concerned with maintaining their own positions.
Bitfarms responded to Riot’s “misleading” claims on Wednesday. “Bitfarms has stated that the forthcoming special meeting is not about corporate governance, as Riot has consistently portrayed it. Rather, it is about Riot’s efforts to acquire Bitfarms at a reduced price for the benefit of Riot shareholders, not Bitfarms shareholders,” the company stated. “Riot has refrained from engaging with us in a constructive manner, such as by declining to submit a revised proposal for our consideration or enter into a standard non-disclosure agreement with Bitfarms. Instead, he has engaged in public attacks and actions to undermine the interests of other Bitfarms shareholders.”
Riot has been purchasing Bitfarms’ stock in order to become its largest shareholder since its initial acquisition attempt in April. Riot holds approximately 19.9% of Bitfarms. The market capitalization of Bitfarms was roughly $1.2 billion as of Wednesday’s opening bell, which is barely more than half of Riot’s figure.
The Bitfarms team is best-in-class, encompassing the appropriate blend of talents and experience to effectively supervise the Company’s strategic plan, Bitfarms stated on Wednesday. Riot’s consent was not required for the recent board and leadership changes. Conversely, it is unclear how Riot’s nominees could improve the Board.
Additionally, the miner substantiated its proposed acquisition of Stronghold by stating that the transaction could result in a total of 307 MW of power capacity and is anticipated to position Bitfarms on course to increase its energy portfolio to over 950 MW, with nearly 50% of that capacity located in the United States, by the end of 2025.
Bifarms’ Board will give due consideration and a response to Riot’s amended requisition proposal. Oct. 29 is the date of the special meeting.
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