Bitfarms responds to Riot Platforms’ Disruptive Actions
Bitfarms Ltd. (Nasdaq/TSX: BITF), a global Bitcoin mining company, has found itself in the midst of a standoff with Riot Platforms, Inc. (Nasdaq: RIOT) over recent disruptive actions. The Special Committee of independent directors at Bitfarms has been evaluating unsolicited proposals, including one from Riot, and has raised concerns about the tactics employed by Riot to disrupt the ongoing strategic alternatives review process.
Special Committee’s Evaluation of Riot’s Proposal
- The Board of Directors at Bitfarms established a Special Committee of independent directors to evaluate various unsolicited proposals, including Riot’s offer dated April 22, 2024.
- Following a thorough assessment, the Special Committee concluded that Riot’s proposal undervalued Bitfarms and was not in the best interests of the shareholders.
Questionable Actions by Riot Platforms
- While Bitfarms welcomed Riot’s interest in the strategic review process, it has raised concerns about Riot’s actions.
- Riot declined to participate in the process and instead started acquiring Bitfarms’ common shares in the open market, which Bitfarms perceives as an attempt to undermine the review process and promote its undervalued bid.
Implementation of Shareholder Rights Plan
- Bitfarms introduced a Shareholder Rights Plan on June 10, 2024, to safeguard the integrity of the strategic review process.
- The plan does not prevent Riot or any other shareholder from making unsolicited takeover bids or director nominations but aims to ensure the Special Committee can work towards maximizing shareholder value.
Allegations of Hypocritical Behavior
- Bitfarms has accused Riot of criticizing its corporate governance while receiving poor governance ratings from Institutional Shareholder Services and Glass Lewis & Co.
- Riot’s actions are viewed as an attempt to serve its own interests at the expense of Bitfarms’ shareholders, according to Bitfarms.
Bitfarms’ Pledge to Shareholders
- Despite the challenges posed by Riot, Bitfarms remains dedicated to maximizing value for its shareholders.
- The Special Committee will continue to explore all opportunities diligently to achieve the best outcomes for shareholders, contrasting what Bitfarms perceives as Riot’s self-serving actions.
Professional Advisors on Board
- Moelis & Company LLC is serving as Bitfarms’ financial advisor, with legal counsel provided by Skadden, Arps, Slate, Meagher & Flom LLP, Peterson McVicar LLP, and McMillan LLP.
About Bitfarms
- Established in 2017, Bitfarms is a global Bitcoin mining company operating multiple mining facilities across North and South America.
- With a commitment to using eco-friendly energy sources, particularly hydro-electric power, Bitfarms aims to operate sustainably in the cryptocurrency mining sector.
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