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Riot Platforms has expressed disapproval of Bitfarms’ implementation of the Poison Pill, labeling it an unfriendly shareholder rights initiative.
This strategy enforces specific limitations on the acquisition of Bitfarms’ shares.
According to Riot’s announcement, the Poison Pill underscores a deficiency in robust corporate governance practices.
Riot Platforms, a prominent Bitcoin mining firm in North America, has strongly criticized competitor Bitfarms for adopting a “poison pill” tactic aimed at preventing potential acquisitions.
Riot contends that this action signifies inadequate corporate governance and neglects shareholder interests.
As stated in Riot Platform’s press release, Bitfarms’ strategy, which is currently active, imposes certain limitations on the purchase of the company’s shares.
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In particular, Bitfarms aims to prevent any shareholder from acquiring 15% or more of the company’s common shares without a formal takeover bid for all outstanding shares.
Riot Comments on Bitfarms’ Adoption of Shareholder-Unfriendly Poison Pill
Poison Pill Comes Just Days After Riot Privately Urged Bitfarms to Consult with Riot and Other Large Shareholders on New Board Members and Stressed that Chairman Nicolas Bonta Must Resign to Address…
— Riot Platforms, Inc. (@RiotPlatforms) June 12, 2024
In a post on X, Riot Platforms indicated that this initiative follows their recent private communication with Bitfarms. Subsequently, Riot Platforms reached out to Bitfarms, encouraging them to appoint two new independent board members and to remove Chairman Nicolas Bonta.
Riot Platforms CEO Jason Les remarked, “In our most recent letter, we urged the Bitfarms Board to facilitate the resignation and removal of Chairman and interim CEO Nicolas Bonta…as a first step to address shareholders’ concerns.”
In criticizing Bitfarms’ decision, Les further stated:
“This action further demonstrates the Bitfarms Board’s entrenchment and disregard for the perspectives of its shareholders, who clearly signaled their discontent less than two weeks ago when they voted out Company co-founder Emiliano Grodzki.”
As reported by Reuters, tensions escalated in April when Riot Platforms proposed to acquire Bitfarms for $950 million, an offer that Bitfarms deemed as undervaluing the company.
Bitfarms’ implementation of the “poison pill” serves as a direct response to counter Riot’s takeover bid.
