Bitfarms Rebuffs Riot Platforms’ Acquisition Attempts and Board Nominations

TLDR:

• Bitfarms responds to Riot Platforms’ claims about special meeting and acquisition attempt
• Bitfarms accuses Riot of trying to acquire Bitfarms at a discounted price
• Bitfarms defends recent board changes and proposed acquisition of Stronghold
• Riot Platforms is Bitfarms’ largest shareholder with a 19.9% stake
• Special shareholder meeting scheduled for October 29 to address the situation

Bitfarms, a leading Bitcoin mining company, has responded to recent claims and actions by Riot Platforms, its largest shareholder.

The ongoing dispute between the two companies has escalated, with Bitfarms accusing Riot of attempting to acquire the company at a discounted price and making misleading statements about corporate governance issues.

Bitfarms emphasized that the upcoming special shareholder meeting, scheduled for October 29, is not about corporate governance as Riot has claimed. Instead, Bitfarms argues that Riot is trying to acquire the company at a reduced price to benefit Riot’s shareholders rather than Bitfarms’ shareholders.

The company stated that Riot has refused to engage constructively, declining to enter into a standard non-disclosure agreement or offer a revised proposal.

Bitfarms defended its recent board and leadership changes, stating that these decisions were made independently of Riot’s influence and were intended to enhance shareholder value for all Bitfarms investors.

Bitfarms also addressed its proposed acquisition of Stronghold, another mining company. The company explained that this move aligns with its strategy to diversify power access and rebalance its energy portfolio towards the United States.

Through this transaction, Bitfarms aims to increase its energy portfolio to over 950 MW, with nearly 50% in the U.S., by the end of 2025.

The conflict between the two companies has been ongoing since May 2024, when Riot Platforms began increasing pressure on Bitfarms to accept a $950 million takeover bid.

In response, Bitfarms initially adopted a shareholder rights plan, often referred to as a “poison pill” strategy, to thwart the hostile takeover attempt. However, this plan was later invalidated by the Ontario Capital Markets Tribunal, a Canadian financial regulator.

Following the invalidation of the shareholder rights plan, Riot Platforms increased its stake in Bitfarms to 19.9%. Riot has also suggested three independent candidates for Bitfarms’ board of directors, a move that Bitfarms views with skepticism.

Bitfarms’ board of directors has stated that they will review Riot’s amended proposal but emphasized that no action is required from shareholders at this time.

The company remains committed to its current strategic plan and believes its existing team has the right mix of skills and experience to effectively oversee the company’s operations.

Bitfarms, founded in 2017, operates 12 Bitcoin data centers across four countries: Canada, the United States, Paraguay, and Argentina. The company emphasizes its use of environmentally friendly hydro-electric power and long-term power contracts in its operations.