BitGo Sues Galaxy Digital for $100 Million After Cancelling Buyout Deal

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Last Updated on September 14, 2022 by Bitfinsider

BitGo, a digital asset financial services company based in California, confirmed the $100 million lawsuit against Galaxy Digital for breaching its $1.2 billion merger agreement in a tweet.

The complaint was filed yesterday in Delaware Chancery Court by Attorney Brian Timmons to allow Galaxy Digital ample time to respond or cite critical information on the matter.

The complaint’s specifics will be made public on September 15, Thursday.

So, where did the BitGo-Galaxy Digital feud begin?

Galaxy Digital, founded by Mike Novogratz, has initially stated its intention to acquire BitGo for $1.2 billion (a mix of stocks and cash) in 2021, with specifics still being negotiated.

Things did not go as planned, and BitGo is now suing Galaxy Digital for allegedly breaching the initial merger agreement.

Galaxy Digital announced earlier that they are withdrawing from the acquisition deal due to a lack of audited financial statements submitted for 2021, in accordance with their “contractual right to terminate.” In accordance with this termination, no termination will be collected.

Quinn Emanuel Law Firm partner Brian Timmons stated, “BitGo has absolutely delivered the audits that were required to close this deal.” Galaxy has the problem, and it’s saying, “It’s not me, it’s you.”

Galaxy is reportedly trading on the Toronto Stock Exchange with the intention of listing on the Nasdaq.

Galaxy recently reported a $554 million loss in the second quarter, coinciding with the crypto meltdown, which also resulted in the company’s failed acquisition deal.

Despite the obvious company losses, Galaxy Digital is still determined to raise funds in order to close more deals.

BitGo evidently decided to extend the merger with Galaxy Digital until March solely due to the breakup fee.

Apart from that, BitGo will never agree to an extension. BitGo evidently has other potential partners interested in acquiring the company.

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