Bitfarms rejected Riot's acquisition proposal because it 'significantly undervalues' the firm

Bitcoin mining firm Bitfarms explained why it rejected Riot Platforms' acquisition proposal in a Wednesday company statement.  

Riot's proposal to purchase all Bitfarms' outstanding shares at $2.30 a piece "determined it significantly undervalues the company and its growth prospects," the company wrote in the release . Additionally, Bitfarms claimed Riot did not respond to its request for customary confidentiality and non-solicitation protections. 

A special committee representing Bitfarms, comprised of an independent board of director members, is still determining the company's next best path, according to the company

"Having received additional unsolicited expressions of interest, with each additional party executing a customary non-disclosure agreement, the special committee is conducting a thorough strategic alternatives review to ensure it achieves maximum shareholder value," Bitfarms said in the statement. "These alternatives could include, among others, continuing to execute on the company’s business plan, a strategic business combination or other strategic transaction or a sale of the company."

On May 28, Riot Platforms announced that it purchased a 9.25% stake in Bitfarms after the rejected acquisition proposal, which valued the latter at $950 million. 

Bitfarms also noted that its search for a new CEO is still underway. The firm fired its former CEO Geoffrey Morphy on May 13 after he filed a $27 million lawsuit against it. Bitfarms' chairman and co-founder Nicolas Bonta stepped in as interim president and chief executive officer.

Amid its leadership transition period, Bitfarms is still expanding its bitcoin mining operational power, noting in the statement that it "realized notable efficiency gains and is progressing toward 2024 guidance of 21 EH/s and 21 w/TH, representing a 223% hashrate increase and 40% efficiency improvement."