FX.co ★ Bitfarms Adopts Shareholder Rights Plan

Bitfarms Ltd. (BITF), a vertically integrated Bitcoin firm, announced on Monday that its Board of Directors has unanimously approved the implementation of a shareholder rights plan. This Rights Plan aims to protect the integrity of the company's strategic alternatives review process, which was previously announced.

On June 10, Bitfarms entered into a shareholder rights plan agreement with TSX Trust Co., acting as the rights agent.

Earlier, the Board established a special committee comprised of independent directors to conduct a Strategic Alternatives Review Process. The committee's mandate includes considering various options such as continuing with the current business plan, pursuing a business combination or another strategic transaction, or even selling the company.

Riot Platforms, Inc. holds a minimum of 47.83 million shares, accounting for 11.62% of Bitfarms' issued and outstanding voting securities. Riot has made an unsolicited proposal to acquire all shares and has announced its intention to requisition a special shareholder meeting. This move is seen as an attempt to bypass and undermine the Strategic Alternatives Review Process managed by the Special Committee.

Upon receiving Riot's proposal on April 22, when Riot owned 3.61% of the voting securities, the Special Committee conducted a thorough evaluation. After careful consideration, the committee concluded that Riot's proposal significantly undervalues Bitfarms and its growth prospects.

The Special Committee has welcomed Riot's interest in the company and its participation in the ongoing Strategic Alternatives Review Process. This includes agreeing to the standstill term proposed by Riot.

However, Bitfarms pointed out that Riot has declined to actively participate in the ongoing review process and has instead chosen to continue purchasing Bitfarms' common shares on the open market.

In pre-market activity on the Nasdaq, Bitfarms shares were trading down approximately 2.9%, at $2.33.