Riot Platforms has proposed acquiring Bitfarms for about $950 million, offering a 24% premium over Bitfarms’ average share price for the past month as of May 24. The announcement follows Bitfarms’ Board of Directors’ rejection of Riot’s earlier private offer without substantial engagement.

Riot aims to create the world’s largest publicly listed Bitcoin miner through this hostile takeover bid, combining its financial strength and strategic vision with Bitfarms’ existing operations. According to Riot Executive Chairman Benjamin Yi, merging the two companies would establish a global leader in Bitcoin mining with diversified operations poised for long-term growth.

Already holding a 9.25% stake in Bitfarms, Riot proposes a mix of cash and common stock that would result in Bitfarms’ shareholders owning approximately 17% of the combined entity. The merger is projected to enhance Bitcoin mining capacity significantly, potentially reaching 1.5 GW of power capacity and 52 EH/s of self-mining capacity by the year’s end.

Citi is advising Riot on financial matters, with legal counsel provided by Paul, Weiss, Rifkind, Wharton & Garrison LLP and Davies Ward Phillips & Vineberg LLP.

Bitfarms has yet to respond publicly to Riot’s latest offer.

The proposal from Riot comes amidst internal upheaval at Bitfarms, including the dismissal of former CEO Geoffrey Morphy, who subsequently filed a $27 million lawsuit against the company alleging wrongful termination. Bitfarms has appointed Nicolas Bonta as interim CEO following Morphy’s departure and has stated its intention to vigorously defend against Morphy’s claims.

The dispute has raised governance concerns among shareholders, including Riot, prompting plans to request a special shareholders meeting after Bitfarms’ Annual General and Special Meeting on May 31, 2024, to nominate new independent directors for Bitfarms’ Board.