Bitcoin Miner Riot Platforms Ups Ownership in Bitfarms to 18.9%

Crypto Reporter

Shalini Nagarajan

Crypto Reporter

Shalini Nagarajan

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Shalini is a crypto reporter who provides in-depth reports on daily developments and regulatory shifts in the cryptocurrency sector.

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Last updated:

August 14, 2024 00:32 EDT

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Bitcoin miner Riot Platforms said Tuesday that it expanded its ownership in competitor Bitfarms, increasing its stake to nearly 18.9%. Riot purchased an additional 1m Bitfarms shares, bringing its total holdings to about 85.3m shares.

Before the latest purchase, Riot Platforms held about 18.68% of Bitfarms’ shares.

Both companies have been embroiled in a dispute since April. It started with Riot trying to buy out its Canadian rival, Bitfarms, with a $950m offer. However, Bitfarms rejected this offer, claiming it undervalued the company.

Bitfarms Adopts Second ‘Poison Pill’ After Tribunal Blocks Initial Defense Against Riot Platforms

To deter Riot’s takeover attempt, Bitfarms implemented a “poison pill” strategy, which allows existing shareholders to buy more shares at a reduced price, making it harder for Riot to increase its ownership stake.

But a Canadian tribunal last month blocked the poison pill, meaning Bitfarms could no longer use it to stop Riot’s takeover bid.

However, anticipating this, Bitfarms has implemented a second “poison pill” as a backup plan. This new measure would kick in if any single entity tries to own more than 20% of the company without the board’s approval.

Riot Weighs Next Steps in Bitfarms Stake

Riot has indicated that it will continue to evaluate its investment in Bitfarms. The company’s future actions will depend on factors such as negotiations between the two companies, including discussions about a shareholder meeting and changes to Bitfarms’ board.

The company is seeking three board positions at Bitfarms and has shown openness to a potential future deal.