Galaxy Digital Vindicated By Delaware Court Ruling On BitGo Deal Termination, June 12
- Galaxy Digital found “valid basis” to terminate BitGo acquisition after company failed to deliver audited financial statements required by the merger agreement.
- Delaware court finds Galaxy Digital had a “valid basis” to terminate the deal.
- BitGo seeks over $100 million in compensation for the termination of the deal.
Galaxy Digital, a cryptocurrency-focused financial services firm, has recently announced that a Delaware court has ruled in its favor over a planned acquisition of BitGo, a crypto custodian.
The court found that Galaxy had a “valid basis” to terminate the deal after BitGo failed to provide audited financial statements required by the merger agreement.
The United States’ Delaware Court of Chancery has recently granted a motion from Galaxy Digital, a crypto investment firm, to largely dismiss BitGo’s case. BitGo had filed a lawsuit against Galaxy Digital for breach of contract and sought $100 million in damages after Galaxy dropped its decision to acquire BitGo in August 2022 as part of a $1.2-billion deal. The court documents, filed on June 9, state that Vice Chancellor J. Travis Laster dismissed BitGo’s complaint against Galaxy Digital with prejudice. Despite Galaxy’s extensive efforts to acquire BitGo, they cited a breach of contract as the reason for backing out of the deal. The court’s decision has now largely dismissed BitGo’s case against Galaxy Digital with prejudice.
This news comes as a relief to Galaxy, which has issued a statement expressing its satisfaction with the outcome. However, the case has been closely watched by industry insiders, as BitGo had previously indicated that it would seek over $100 million in compensation for the termination of the deal.
Galaxy Digital expressed its satisfaction with the outcome in an emailed statement. Nevertheless, the termination of the deal is not without consequences. BitGo, which had previously announced that it would seek over $100 million in compensation for Galaxy Digital’s decision to end the acquisition, is now likely to pursue legal action to recover the damages.
This recent development highlights the importance of adhering to the terms of a merger agreement, and ensuring all necessary requirements are met. Failure to do so can have significant legal and financial consequences for all parties involved. As such, it is essential that businesses and investors take the necessary steps to ensure compliance, and have the appropriate safeguards in place to protect their interests.
This case serves as a reminder of the challenges and complexities of navigating the cryptocurrency landscape, and the importance of seeking expert advice and guidance when dealing with these types of transactions.
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