TORONTO - Bitfarms Ltd. (NASDAQ/TSX: BITF), a prominent player in the Bitcoin data center sector, and Riot Platforms Inc. (NASDAQ: NASDAQ:RIOT), a key figure in Bitcoin mining, announced a settlement agreement today, ahead of Bitfarms' Special Meeting of Shareholders scheduled for November 6, 2024. As part of the agreement, Andrés Finkielsztain has resigned from Bitfarms' Board of Directors, and Amy Freedman has been appointed as a board member effective immediately.
The agreement also stipulates that Riot withdraws its previous requisition and accepts standstill provisions through the Bitfarms 2026 Annual Meeting, with certain exceptions. At the upcoming Special Meeting, now to be held virtually, shareholders will vote on expanding the Board from five to six members and elect an independent director nominated by the Board. Riot has agreed to vote in favor of these proposals, and shareholders will also be asked to ratify a shareholder rights plan from July 24, 2024.
Brian Howlett, Independent Chairman of the Board of Bitfarms, expressed gratitude to Finkielsztain for his contributions and welcomed Freedman, highlighting her extensive experience in advising public companies. Ben Gagnon, CEO of Bitfarms, emphasized the company's focus on diversification and growth strategy, while Jason Les, CEO of Riot, recognized the agreement as a step towards advancing shareholder value.
Freedman brings over 25 years of experience in corporate governance and public capital markets to Bitfarms. She serves as an advisor to Ewing Morris and Co. Investment Partners and has held leadership roles at Kingsdale Advisors. Her capital market experience includes tenure with Stifel Financial (NYSE:SF) Corp. and Morgan Stanley. Freedman also serves on the boards of several other companies and holds an MBA and JD (NASDAQ:JD) from the University of Toronto.
The full agreement will be filed with the U.S. Securities and Exchange Commission and made available on the Company’s SEDAR+ profile.
This development comes as Bitfarms continues to operate 12 Bitcoin data centers across four countries, emphasizing its commitment to sustainable energy use. Both Bitfarms and Riot Platforms are focused on enhancing shareholder value and executing growth strategies within the cryptocurrency mining industry.
The information in this article is based on a press release statement.
In other recent news, Riot Platforms, a key player in the Bitcoin mining industry, has reached a significant milestone of holding over 10,000 Bitcoin. The company's production and operational updates for August 2024 also indicated a total deployed hash rate of 23.5 EH/s across all facilities, marking a 128% rise from the previous year. Meanwhile, Riot Platforms has increased its stake in competitor Bitfarms to 18.9%, acquiring an additional 1 million common shares. This strategic move follows ongoing tensions between the two companies and the recent departure of Bitfarms' co-founder and chair, Nicolas Bonta.
In a bid to streamline operations, Riot Platforms has removed its data center hosting segment from reportable business segments, following the termination of all contracts with the company's data center hosting and colocation customers. On the financial front, the company reported revenues of $70 million, surpassing projections. However, adjusted EBITDA was significantly lower than the anticipated $16 million. Following these developments, Needham maintained a Buy rating on Riot Platforms, increasing the price target to $14, while Stifel Canada initiated coverage with a Speculative Buy rating and a price target set at $18.00.
Riot Platforms has also expanded its operations with the acquisition of Block Mining in Kentucky, adding 1 EH/s to its self-mining capacity. This acquisition is part of the company's ongoing efforts to increase hash rate at its facilities, with a year-end goal of 36 EH/s. These are among the recent developments as Riot Platforms continues to make strategic moves in the Bitcoin mining industry.
InvestingPro Insights
In light of the recent developments between Bitfarms Ltd. and Riot Platforms Inc., investors are closely monitoring the performance metrics and future outlook of these companies. Riot Platforms, in particular, has been the subject of investor attention due to its role in the Bitcoin mining sector. According to InvestingPro data, Riot holds a market capitalization of approximately $2.18 billion, with a P/E ratio of 17.96, indicating investor valuation of its earnings capacity. Despite a challenging environment for tech stocks, Riot's net income is expected to grow this year, as per InvestingPro Tips, suggesting a potential upside for investors looking at near-term profitability.
Moreover, Riot's stock price movements have been notably volatile, reflecting the inherent risks and opportunities within the cryptocurrency mining industry. The company's stock price has seen a significant decline over the last three months, yet analysts predict the company will be profitable this year, which could signal a turnaround for the company's financial performance. Additionally, Riot's liquid assets exceed its short-term obligations, providing a cushion for operational flexibility.
For those seeking more in-depth analysis, InvestingPro offers a range of additional tips. Currently, there are 15 more InvestingPro Tips available for Riot Platforms, which can be accessed through the InvestingPro platform at https://www.investing.com/pro/RIOT. These tips provide valuable insights into the company's financial health, valuation, and market performance, which are crucial for making informed investment decisions.
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