Galaxy Digital Holdings and its CEO and founder Mike Novogratz announced that the company has “exercised its right to terminate” its previously announced acquisition of Bitgo. According to Galaxy, the termination of the acquisition was due to Bitgo’s “failure to file” its audited financial statements for 2021.
Galaxy terminates deal with crypto custodian Bitgo
On Monday,Galaxy Digital Holdings(TSX: GLXY) said it has closed a proposed $1.2 billion stock and cash deal that would allow the crypto company to acquire the digital asset custodian and financial services providerexplained. Bitgo. Galaxy’sannouncementdetailed that the abandoned transaction was due to Bitgo “not providing” certain financial documents.
“[Galaxy] exercised its right to terminate its previously announced acquisition agreement with Bitgo following Bitgo’s failure to provide audited financial statements for 2021 in compliance with the requirements of our agreement by July 31, 2022,” the crypto company detailed.” No termination fee will be paid in connection with the termination.”
The news follows Galaxy’s exposure to the disruption of the Terra blockchain and the company’s founder, Mike Novogratz, addressing the subject of LUNA in mid-May; in a letter Novogratz wrote, “The market and Terra’s ecosystem are in a state of flux. There is no good news in what has happened,” he explained, while reminding investors of basic investment concepts such as profit taking and risk management along the way. Novogratz emphasized at the time that Galaxy Digital adhered to this basic tenet when investing in LUNA.
Mike Novogratz Says Galaxy Is Positioned for Success, Will Continue to List on NASDAQ
During Monday’s announcement, Galaxy’s CEO positioned for, he noted. Galaxy remains positioned to succeed and to take advantage of strategic opportunities to grow in a sustainable manner,” Novogratz said in a statement Monday. Novogratz added, “We remain committed to continuing the process of going public in the U.S. and providing our customers with the prime solutions that truly make Galaxy a one-stop store for financial institutions.”
He further noted that Galaxy continues to plan to list its shares on NASDAQ following the completion of the Securities and Exchange Commission (SEC) review. Galaxy stated, “As previously announced, Galaxy intends to complete a reorganization and domestication to become a Delaware-based company, subject to completion of the SEC review and stock exchange approval of such a listing, and then to list on NASDAQ.”
Bitgo responded to Galaxy Digital’s statement, with the company’s lawyer saying Galaxy’s “attempt to blame the termination on Bitgo is absurd.”
Following Galaxy Digital’s announcement on Monday of its acquisition of the terminated Bitgo, the Palo Alto, California-based crypto financial servicessaidthat Galaxy is “legally liable for its improper decision to terminate the merger,” detailing that Bitgo has hired the Los Angeles-based litigation firmQuinn Emanuelto “take appropriate legal action.”
Quinn Emanuel is one of the top global white shoe law firms in the world, with approximately 23 offices in countless countries.After Galaxy’s press release announcement, Quinn Emanuel partner R. Brian Timmons said of the issues between the two firms.
“The attempt to blame Bitgo for the termination by Mike Novogratz and Galaxy Digital is unreasonable,” Timmons wrote in a statement.” Bitgo has so far complied with its obligations, including the delivery of its audited financials; that Galaxy posted a $550 million loss this past quarter; that the company’s stock price has been depressed; and that both Galaxy and Novogratz have been distracted by the Luna fiasco are It is public knowledge. Galaxy must pay Bitgo the $100 million termination fee as promised or act in bad faith and face damages of equal or greater amount.” It states.
What do you think about Galaxy’s termination of its deal with crypto custodian Bitgo? Also, what do you think about Bitgo’s reaction to this news? Let us know what you think about this subject in the comments section below.
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