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- Last year, Galaxy abandoned its $1.2 billion attempt to acquire BitGo.
- The court ruled in favor of Galaxy due to BitGo’s failure to provide the financial documents on time.
A lawsuit against Galaxy Digital, a cryptocurrency investment firm, has recently been dismissed, indicating that it will not be required to pay any damages associated with its failed acquisition agreement with crypto custodian BitGo. Upon the court’s decision to dismiss the lawsuit, Galaxy expressed that it was “satisfied” with the outcome.
The company tweeted:
“Now is the time for all of us to collaborate and concentrate on the task at hand: Enhancing the global financial system in a way that fosters innovation while safeguarding investors and consumers.”
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Last year, Galaxy Digital, which is supported by experienced Wall Street investor Mike Novogratz, withdrew its $1.2 billion offer to acquire BitGo. The company stated that it made this decision because the acquisition target failed to meet a deadline for submitting audited financial statements.
However, BitGo has indicated that it plans to sue Galaxy, as the merger agreement is not set to expire until the year’s end. A vice chancellor of the Delaware Chancery Court ruled last week that Galaxy had a “valid basis” to end the proceedings due to BitGo’s noncompliance with the financial document submission.
Withdrawn from Merger Due to Claims of Losses
The $1.2 billion acquisition of BitGo by Galaxy was first announced in May 2021. If completed, it would have been one of the largest transactions in the cryptocurrency industry. In May 2022, Galaxy indicated that the deal was expected to be finalized by the year’s end.
Then, in August, it announced that the transaction was canceled. This announcement followed Galaxy’s disclosure of $554 million in unrealized losses on its crypto assets for the second quarter of that year, coming just a week after that statement.
In September, BitGo initiated a lawsuit in the Delaware Chancery Court, claiming that Galaxy withdrew from the merger due to its losses and ambitions to go public. BitGo sought $100 million in damages.
