Riot Platforms called Bitfarm’s poison pill to prevent the bitcoin miner’s acquisition “shareholder unfriendly” and highlighted its poor corporate governance
Riot stated that it had privately encouraged Bitfarms to remove its chairman and interim CEO, Nicolas Bonta, and to appoint at least two new independent directors to its board on Wednesday.
The dispute results from an unsolicited offer by Riot in April to acquire Bitfarms for approximately $950 million. Bitfarms rejected the offer, asserting that it significantly undervalued the company. The company authorized a poison pill plan to prevent any hostile takeover attempts.
Bitfarms will issue new shares to other stockholders to dilute the entity’s stake if an entity acquires a more than 15% stake in the company after June 20 and up to Sept. 10.
The 15% trigger “is in direct conflict with established legal and governance standards,” Riot stated on Wednesday.
“We will continue to push to address the serious corporate governance issues at Bitfarms and ensure that shareholders have a say on the company’s path forward,” said Riot’s chief executive officer, Jason Les.
Riot disclosed in a regulatory filing that it had increased its stake in Bitfarms to 13.1% from 12% earlier this month.
According to LSEG data, the organization is Bitfarm’s largest shareholder.
Although the crypto industry has experienced a surge of optimism following the approval of exchange-traded funds linked to the current price of bitcoin, Riot and Bitfarms have experienced a 35% and 19% decline in their shares this year, respectively.