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Riot Platforms has criticized Bitfarms' adoption of a "poison pill" shareholder rights plan, calling it an unfriendly move aimed at thwarting Riot's unsolicited takeover bid for the company.[1]
The "poison pill" strategy, implemented by Bitfarms, is a defensive tactic designed to make a hostile takeover prohibitively expensive for the acquirer. If triggered, it would dilute Riot's existing 12% stake in Bitfarms by issuing new shares to other shareholders.[4][5]
Bitfarms claims the plan is necessary to protect the integrity of its ongoing strategic review process, which is exploring various alternatives including potential business combinations or a sale.[3][6] The company argues that Riot's continued accumulation of shares undermines this process and prevents maximizing shareholder value.[6]
While Riot can still proceed with a takeover bid in compliance with Canadian securities laws, the "poison pill" raises the acquisition threshold and makes it costlier for Riot to increase its stake beyond 15% before September 10 or 20% thereafter.[3][4][6] The plan requires approval from Bitfarms' shareholders within six months and is awaiting acceptance by the Toronto Stock Exchange.[4][6]