InsideArbitrage Potential Deal Alert: Bitfarms (BITF) announces that the Strategic Alternatives Process is Underway

POTENTIAL DEAL DETAILS

Bitfarms (BITF) announced that the Special Committee is conducting a thorough strategic alternatives review to ensure it achieves maximum shareholder value. These alternatives could include, among others, continuing to execute the Company’s business plan, a strategic business combination or other strategic transaction, or a sale of the Company.

Bitfarms said it received a proposal from Riot Platforms (RIOT) on April 22, 2024, to acquire 100% of the common shares of Bitfarms, for $2.30 per common share consisting of cash and Riot common stock. The Special Committee of the Board comprised solely of independent directors carefully considered the proposal and determined it significantly undervalues the Company and its growth prospects.

Bitfarms Ltd. Investor Relations

Riot Platforms Investor Relations

Update(s):

June 5, 2024: Riot Platforms (RIOT) announced that it bought 1.46 million new common shares of Bitfarms (BITF) on June 5, 2024, bringing its ownership in the company to 12%. Following the completion of the transaction, Riot intends to nominate several independent directors to join Bitfarm’s board of directors. Riot also intends to review its investment in Bitfarms continuously and depending upon various factors, including any discussion between Riot and Bitfarms regarding Riot’s previously submitted non-binding proposal.

June 10, 2024: Bitfarms (BITF) announced a shareholder rights plan agreement entered into with TSX Trust Company, as rights agent, dated June 10, 2024. The Rights Plan is being adopted to preserve the integrity of the strategic alternatives review process and is in the best interests of all Bitfarms’ shareholders. The Rights Plan allows Riot to proceed with an unsolicited take-over bid in accordance with applicable Canadian securities laws and does not prevent Riot Platforms (RIOT) from making nominations and soliciting proxies in respect of a requisition.

June 12, 2024: Riot Platforms (RIOT) commented on the shareholder rights plan (Poison Pill) unilaterally adopted by Bitfarms (BITF), which takes immediate effect and effectively prevents any shareholder from acquiring 15% or more of Bitfarms’ common shares without making a formal take-over bid for all of the company’s shares. The 15% trigger is in direct conflict with established legal and governance standards, including those published by leading proxy advisory firms Institutional Shareholder Services and Glass, Lewis & Co., and is further evidence of the Bitfarms Board disregarding good corporate governance.

Bitfarms in response to Riot Platforms said that the board had formed a Special Committee to review unsolicited proposals, including a significantly undervalued bid from Riot on April 22. While welcoming Riot’s interest, Bitfarms criticized Riot for declining to participate in the Strategic Alternatives Review Process and for acquiring shares to undermine it. The Shareholder Rights Plan, adopted on June 10, aims to preserve this process’s integrity without preventing take-over bids or director nominations.

June 13, 2024: Riot (RIOT) announced that it acquired ownership of over 1.4 million common shares of Bitfarms (BITF) representing approximately 0.35% of the issued and outstanding common shares of the company. Following the completion of the aforementioned acquisition, Riot beneficially owned about 57.63 million common shares, representing approximately 14.00% of the issued and outstanding common shares of Bitfarms.

June 24, 2024: Riot Platforms (RIOT) announced that it requisitioned a special meeting of Bitfarms (BITF) shareholders (Special Meeting) to reconstitute the Bitfarms Board of Directors. The Special Meeting will allow Bitfarms shareholders to vote on the removal of Bitfarms Chairman and Interim CEO Nicolas Bonta and director Andrés Finkielsztain. To replace these individuals, Riot has nominated three candidates: John Delaney, Amy Freedman, and Ralph Goehring. Riot has withdrawn its proposal to acquire all Bitfarms common shares for $2.30 per share and stands ready to engage and negotiate with a reconstituted Bitfarms Board to pursue a mutually beneficial combination of Bitfarms and Riot.

June 25, 2024: The Ontario Securities Commission Tribunal will hold a hearing on Thursday to consider Riot Platforms’ (RIOT) application for cease trade orders against Bitfarms’ (BITF) shareholder rights plan, with a case management hearing set for June 27, 2024, at 10:30 AM ET.

June 27, 2024: Bitfarms (BITF) announced that its board of directors approved the appointment of Fanny Philip to the company’s board, effective immediately. With the appointment of Philip, Bitfarms’ board is now composed of five directors, four of whom are independent.

July 8, 2024: Bitfarms (BITF) announced the appointment of Ben Gagnon as Chief Executive Officer, effective immediately. Bitfarms clarified that the CEO’s retention is separate from the Special Committee’s thorough review of strategic alternatives aimed at maximizing shareholder value.

July 12, 2024: Bitfarms (BITF) announced that its Board has called a hybrid special meeting of shareholders to be held on October 29, 2024, in response to a requisition for a shareholders’ meeting submitted by Riot Platforms (RIOT).

July 24, 2024: Riot Platforms (RIOT) announced that the Ontario Capital Markets Tribunal has immediately cease-traded Bitfarms’ (BITF) poison pill. In response, Bitfarms announced adopting a new shareholder rights plan, which will issue one right per common share as of August 6, 2024. This New Rights Plan becomes exercisable if an entity acquires 20% or more of the shares without adhering to the plan’s provisions, allowing rights holders to purchase shares at a discount. The plan requires shareholder ratification within six months to remain effective and is pending acceptance by the Toronto Stock Exchange. The Bitfarms Board is recommending ratification at the October meeting.

July 26, 2024: Bitfarms (BITF) announced that the Toronto Stock Exchange (TSX) will delay approving its new shareholder rights plan. The delay will last until the securities commission agrees not to intervene and shareholders approve the plan by January 24, 2025. Despite this delay, the plan will still be in effect for at least six months from July 24, 2024, unless it is ended earlier.

August 2, 2024: Riot (RIOT) announced its acquisition of 380,838 common shares of Bitfarms (BITF), representing about 0.08% of the outstanding shares, purchased on the Nasdaq Stock Market at an average price of $2.40 per share. This acquisition increased Riot’s ownership to over 76 million shares or about 16.90% of the company.

August 13, 2024: Riot (RIOT) announced the acquisition of 1 million common shares of Bitfarms (BITF), representing approximately 0.22% of the total issued and outstanding shares. This purchase increases Riot’s total ownership to roughly 18.90%.

September 3, 2024: Riot Platforms (RIOT), the largest shareholder of Bitfarms (BITF), owning 19.9% of the company, issued a letter to fellow shareholders expressing concerns about Bitfarms’ recent actions, including board changes and the proposed acquisition of Stronghold Digital Mining (SDIG). Riot criticized Bitfarms’ governance, citing issues such as a failed poison pill strategy, unilateral board appointments, and the Stronghold acquisition. Riot reduced its proposed new director nominees from three to two – Amy Freedman and John Delaney to replace two Bitfarms directors: co-founder Andres Finkielsztain and Fanny Philip, emphasizing the need for further board refreshment and urging Bitfarms to halt defensive tactics ahead of the upcoming special shareholder meeting on October 29.

September 4, 2024: Bitfarms (BITF) responded to Riot Platforms (RIOT), stating that Riot is trying to buy Bitfarms at a low price to benefit its own shareholders. Bitfarms pointed out that Riot has not cooperated, refusing to discuss the deal or offer a better proposal, and has instead attacked Bitfarms publicly. Bitfarms made recent leadership changes to improve the company for all its shareholders, not to please Riot. They also highlighted their plan to acquire Stronghold (SDIG), which will help expand their energy resources in the U.S. and grow the company.

September 9, 2024: Bitfarms (BITF) announced that it has rescheduled the Special Meeting of shareholders from October 29, 2024, to November 6, 2024. The Special Meeting was rescheduled to provide the Bitfarms Special Committee adequate time to review and respond to Riot’s (RIOT) Amended Requisition and provide shareholders with sufficient time to evaluate the information relevant to this voting decision regarding the future of their investment in Bitfarms.

September 10, 2024: Bitfarms (BITF) announced that effective immediately, Alex Brammer has been appointed Senior Vice President of Global Mining Operations, and Benoit Gobeil has been promoted to Chief Infrastructure Officer. In conjunction with these appointments, Bitfarms Mining Operations will now be split into two divisions, Mining Operations, and Infrastructure, with Brammer and Gobeil heading up the divisions, respectively.

September 23, 2024: Bitfarms (BITF) announced it entered into a settlement agreement with Riot (RIOT) in advance of the Special Meeting of Bitfarms Shareholders scheduled for November 6, 2024. Under the terms of the agreement, Andrés Finkielsztain has stepped down from Bitfarms’ Board. Bitfarms has appointed Amy Freedman to its Board and the Governance and Nominating Committee and Compensation Committee of the Board, effective immediately. Riot has agreed to withdraw its June 24, 2024 requisition. At the Special Meeting, shareholders will be asked to approve an expansion of the Board from five members to six members, to elect an independent director nominated by the Board to serve as the sixth member of the Board, and to ratify the company’s shareholder rights plan. Riot has agreed to vote in favor of these matters. Bitfarms provided Riot with certain rights to purchase shares of the company provided Riot holds 15% or more of the outstanding shares. The Special Meeting may be delayed, but in no event will it be held later than November 20, 2024.

Disclaimer: Our intent with this section of the website is to present potential deals that appear to be in the pipeline. These potential deals are ones where i) the company has indicated that it is "seeking strategic alternatives", ii) there has been an unsolicited bid for a company as mentioned in a press release by the company or iii) news about the deal has been published by a leading news organization like The Wall Street Journal, The New York Times, Bloomberg, Financial Times, The Washington Post, Reuters and The Associated Press. As best as possible we will try to avoid baseless rumors. There is a high probability that many of these potential deals may not materialize and if they do, the terms of the deal may be different from what was initially reported. Please do your own due diligence before buying or selling any securities mentioned on this website. We do not warrant the completeness or accuracy of the content or data provided.