-A Canadian court has halted Bitfarm's attempt to adopt a "poison pill" strategy designed to thwart a takeover attempt by rival mining company Riot Pla
tforms.In a July 24 statement, Riot said the Ontario Capital Markets Tribunal has issued a cease trade order against Bitfarm's "poison pill" plan, setting it aside with immediate effect.
Since June 13, Bitfarm has challenged Riot Platforms' $950 million takeover offer, claiming it unfairly undervalues the company. To block the takeover, the company has adopted a "poison pill" strategy, known as the "Rights Plan.
The poison pill strategy is often used by companies to block hostile takeovers. Under this strategy, existing shareholders purchase additional shares at a significantly reduced price, diluting the value of the acquirer's shares.
Under Bitfirm's now defunct rights plan, if the company acquires at least 15% of its outstanding shares by September 10, Bitfirm will issue new shares to other existing shareholders to dilute their stake.
Jason Less, CEO of Riot Platforms, said in a statement.
"Taking the poison pill off-market is yet another example of the poor corporate governance that Bitfarm suffers from and the ongoing attempts by Bitfarm's directors to increase their control.
added Les:
Riot said it believes three director nominees, John Delaney, Amy Friedman and Ralph Gehring, should be elected to the Bitfarm board at the next general meeting of shareholders, currently scheduled for October 29.29.
In the meantime, Brian Howlett, lead director of the Bitfarms board, said the rights plan was introduced to "preserve the integrity" of the alternative takeover process, given Riot's "opportunistic" attempt to acquire the company.
Mr. Howlett added: "In light of this decision, Bitfarm's board of directors has adopted a new rights plan to ensure that the interests of all shareholders are protected.
Bitfarms operates 12 #bitcoin #mining operations in four countries - Canada, the US, Paraguay and Argentina.
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