The board of directors of the mining company Bitfarms has adopted a shareholder rights plan following a purchase proposal from competitor Riot Platforms.
This initiative, commonly referred to as a “poison pill,” aims to protect the interests of security holders by preventing any potential hostile takeover attempts.
On May 29, it was revealed that Riot Platforms had made a $950 million acquisition offer. The proposal included a 20% premium over the average stock prices for the month.
At that time, Bitfarms’ board expressed a desire to continue discussions on the potential deal “in a substantive manner,” while adhering to traditional confidentiality measures. A special committee stated that the offer “significantly undervalues the company and its growth prospects.”
At this stage, Riot Platforms declined to participate in the process of exploring strategic alternatives.
“Instead, [it] continued to acquire the company’s common shares on the open market, purchasing an 8.01% stake since April 22, 2024,” the press release states.
As a result, Riot Platforms’ stake reached 11.62%.
The “poison pill” sets a threshold for securities accumulation at 15% before it triggers, intended to prevent an immediate threat to the strategic review process.
According to the document, starting June 20, one right will be issued per common share, which can be exercised if any person, along with certain related parties, acquires 15% or more of the outstanding securities before September 10 or 20% thereafter, without adhering to the plan’s rules.
In January, CoinShares experts included Bitfarms among the few mining enterprises expected to remain profitable post-halving, even with Bitcoin prices around $40,000.
Earlier in June, Core Scientific rejected a non-binding offer from AI firm CoreWeave to purchase all outstanding shares at $5.75 each, totaling approximately $1.02 billion.