Bitfarms Delays Special Shareholders’ Meeting to Address Riot’s New Board Demand

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Canadian Bitcoin miner Bitfarms has postponed its October special shareholders’ meeting to November 6. This decision comes in response to calls Riot Platforms, demanding changes to its board of directors.

The development comes a few weeks after Riot acquired 1 million Bitfarms common shares in August. This purchase elevated Riot to Bitfarms’ largest shareholder with an 18.9% stake.

Riot Platforms Wants More Independent Directors on Bitfarms’ Board

On September 3, Riot published an open letter to Bitfarms shareholders, iterating its attempts to address some defects in the mining company’s governance. 

In its recent open letter, Riot Platforms proposed a more proactive approach to protecting shareholders’ best interests. 

Its letter stated that Bitfarms needs more independent directors with sufficient experience and expertise to make strategic decisions to move the company forward. 

This letter follows Ben Gagnon’s appointment as Bitfarms CEO in July 2024, following Geoffrey Morphy’s departure in March. Gagnon also joined the Bitfarms board after the departure of two of the company’s co-founders, Nicolas Bonta and Emiliano Grodzki. 

Before becoming the CEO, Gagnon was Bitfarms’ chief mining officer from 2021 to 2020 and the director of mining operations. 

Bitfarms Reacts to Riot Platforms’ Letter

In response to Riot’s call for a change in its board of directors, Bitfarms moved its special shareholders’ meeting from October 29 to November 6.

The company said the postponement will allow it to review and evaluate the implications of Riot’s demands. Riot Platforms and Bitfarms tout their decisions to be in the best interest of Bitfarms shareholders. Both bitcoin mining firms accused each other of planning a personal agenda.

In response to Riot’s demand for additional independent directors, Bitfarm’s special committee crafted a settlement agreement, which includes adding one mutually nominated Board member. This will increase the size of Bitfarms’ board to six. 

The proposed settlement agreement also includes other customary provisions. Also, during the upcoming November special meeting, Bitfarms shareholders will vote and share their opinions on the Riot-Bitfarms proxy fight. 

Riot Platform Expands Its Influence on Bitfarms

Leading North American Bitcoin mining company Riot Platforms sought to acquire Canada-based Bitfarms as part of its expansion plans. 

In May this year, the American Bitcoin miner made an unsolicited offer of $950 million to buy Bitfarms. However, Bitfarms declined the offer, touting that it was undervalued. Riot went ahead to acquire a 9.25% stake in Bitfarms. 

Following the rejected deal, both crypto-mining giants have been in the crosshairs. Riot Platforms is trying to expand its influence and fully acquire its rival Bitfarms.

In August, Riot acquired an additional $2.28 million in Bitfarms common shares, increasing its stake in the company to 18.9%. This most recent purchase crowned Riot Platforms as Bitfarms’ largest shareholder with 85.3 million shares, an increase of 1 million from its previous 84.3 million.

The North American crypto mining company has indicated its plans to continue investing in Bitfarms. Riot Platforms’ recent demands to change Bitfarms’ board composition is part of its strategy to grow its influence on the rival Bitcoin miner.