Riot announced its intention to replace Bitfarms’ board members, including its interim CEO, with three “completely independent” individuals from both companies.
Riot Platforms, which has been endeavoring to acquire Canadian mining firm Bitfarms, has announced its intention to replace three members of the company’s board of directors.
Riot disclosed in a June 24 notice that it owned approximately 14.9% of Bitfarms following the mining company’s announcement of a shareholder rights plan that would prevent it from acquiring more than 15% of its stock.
Riot intended to replace three of the company’s board members and “remove any additional director” appointed after its announcement rather than continue to purchase Bitfarm shares.
“It is evident that it is impossible to negotiate a potential merger with the current Bitfarms Board,” stated Riot. Riot has formally withdrawn its previous proposal to acquire all Bitfarms common shares for US$2.30 per share.
It is prepared to engage and negotiate with a reconstituted Bitfarms Board to pursue a mutually beneficial combination of Bitfarms and Riot. This information was provided to the Bitfarms Board.
The mining company intended to replace the board members with three “completely independent of Riot and Bitfarms” individuals: John Delaney, Amy Freedman, and Ralph Goehring. Bitfarms’ stock price on the Nasdaq has increased by over 36% in the past 30 days due to the acquisition plans.
However, it has experienced an approximately 6% decline in the past 24 hours. Cointelegraph contacted bitfarms for comment; however, no response was received at the time of publication.
The mining company alleged that Bitfarms’ board had been “unwilling to engage constructively” regarding the takeover and that the company had “botched its CEO succession process.”
Geoffrey Morphy, the former CEO of Bitfarms, resigned in May after filing a lawsuit against the company. Nicolas Bonta has been serving as the interim president and CEO; however, he may be removed as one of the three board members if Riot’s shareholders’ appeal is compelling.
The most recent development in Riot’s strategy to penetrate Bitfarms was the intention to reform the Bitfarms board. Riot proposed to acquire the mining company for $950 million in May and subsequently increased its stake until Bitfarms implemented its “poison pill” strategy, which restricted its holdings to 15%.
