Galaxy Digital, a virtual asset leader, has terminated its ongoing acquisition deal with the crypto custodian, BitGo. The firm announced the development in a press release on its platform. The terminated deal is worth $1.2 billion in stock and cash.
Recall that Galaxy Digital had, in recent times, been locked in negotiations to acquire BitGo. The blockchain leader has terminated the deal, citing the failure of BitGo to avail necessary financial documents as the reason. The firm had initially given BitGo’s team till July 31 to avail of the 2021 audited financial statements of the firm in line with the deal’s stipulations. According to Galaxy Digital, the BitGo team failed to meet up with the ultimatum.
The terms of the acquisition deal allow for its termination at any stage of the negotiations. Galaxy Digital says it has decided to execute its right to terminate the acquisition of BitGo. Additionally, the blockchain leader revealed that “no termination fee is payable in connection to the termination.”
Reacting to the development, Mike Novogratz, CEO, and Founder of Galaxy Digitals, blasted BitGo for failing to live up to the terms of the deal. According to him, the BitGo team was not ready to provide specific statements to aid the acquisition deal.
However, the CEO maintained that “Galaxy remains positioned for success and to take advantage of strategic opportunities to grow sustainably.” He reiterated Galaxy’s commitment to ensuring its listing in the U.S. Novogratz added that the firm aims to avail seasoned and effective solutions to its clients.
Galaxy Digital announced its plan to list its shares on Nasdaq. This, as revealed, will be possible after the conclusion of the US Securities and Exchange Commission (SEC) review. Similarly, the blockchain leader intends to implement its proposed “reorganization and domestication” to emerge as a Delaware-based company.
The BitGo team has now criticized Galaxy for terminating the deal. BitGo said Galaxy was “legally responsible for its improper decision to terminate the merger.” The crypto custodian said it had hired a litigation firm, Quinn Emanuel, to assess the situation and take appropriate legal action.
According to BitGo, “the attempt by Mike Novogratz and Galaxy Digital to blame the termination on BitGo is absurd.” The firm said it has “fulfilled its obligations in the deal, including the delivery of its audited financials.” BitGo added that “either Galaxy owes BitGo a $100 million termination fee as promised or it has been acting in bad faith and faces damages of that much or more.”
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