Key Takeaways
- Riot to withdraw its previous requisition and support an expansion of Bitfarms’ Board from five to six members
- Riot has agreed to a standstill arrangement lasting until 2026, during which it will refrain from making additional takeover attemptsย
On September 23, Bitcoin miner Bitfarms announced that it had reached a settlement agreement with Riot Platforms and had ended its month-long dispute. As part of the settlement, Amy Freedman, a former investment banker with expertise in corporate governance, will join Bitfarms’ board of directors, replacing Andrรฉs Finkielsztain.
Riot will also withdraw its previous requisition and support an expansion of Bitfarms’ Board from five to six members. Additionally, Riot has agreed to a standstill arrangement lasting until 2026, during which it will refrain from making further hostile moves, including additional takeover attempts or increasing its stake beyond a specified limit.
Riotโs CEO Jason Les highlighted the importance of the settlement, calling it โa significant step to advance shareholder value creation.โ The agreement will be filed with the U.S. Securities and Exchange Commission and posted on SEDAR.
The dispute between the two companies began in April when Riot made an unsolicited $950 million offer to acquire Bitfarms, which the latter rejected, dubbing the proposal as undervaluing the company.
In response, Bitfarms adopted a โpoison pillโ defense to deter Riotโs potential hostile takeover attempts. This was met with tough opposition from Riot platforms.
In June, Riot requisitioned a special shareholder meeting to remove certain Bitfarms directors and replace them with independent candidates. Last month, Riot acquired an additional $2.28 million to increase its stake to 18.9%. In mid-August, Bitfarms announced the immediate departure of co-founder and chair Nicolas Bonta, one of the three board members Riot targeted for replacement.
Freedmanโs role will extend beyond simply serving on the board; she will also participate in the Governance, Nominating, and Compensation Committees.According to the official press release, at the upcoming special shareholder meeting, scheduled to be held no later than November 20, 2024, shareholders will vote on the proposed board expansion and the ratification of Bitfarms’ shareholder rights plan.
Bitfarms,founded in 2017, has 11 Bitcoin mining facilities in Canada, Paraguay, the USA and Argentina. Earlier in April, the crypto miner announced that it planned to invest roughly $240 million to upgrade its mining equipment following the BTC halving event, potentially increasing its hash rate capacity to 21 exahashes per second.