- Voyager Digital has rejected Alameda’s takeover bid.
- The offer would benefit Alameda and hurt customers.
- Voyager prefers its own restructuring proposal.
Centralized crypto lender Voyager Digital Holdings has turned down an offer from FTX and its investment arm Alameda Ventures. Alameda offered to buy the digital assets. As a reason, Voyager stated that the measures were “not value-maximizing” and would possibly “harm customers”.
In a letter of rejection on Sunday, issued as part of the ongoing bankruptcy proceedings at the court submitted became, leaned Voyager’s lawyers dismissed Friday’s offer by FTX, FTX US and Alameda to acquire all of Voyager’s assets and outstanding debt (except for the defaulted loan to Three Arrows Capital).
The letter said the release of such bids could jeopardize other potential deals because it would undermine “a coordinated, confidential, competitive bidding process.” It further said, “AlamedaFTX has breached numerous obligations to the debtors and the bankruptcy court.”
Voyager officials say their proposed plan to restructure the company is better because it would make all customers’ cash and much of their cryptocurrency available as soon as possible.
You have all heard the terms “hero,” “bailout,” “rescue,” and “help” in reference to FTX saving distressed companies. Voyager, one of the aforementioned companies, disagrees – they think that SBF’s deal is extremely predatory and will actually hurt customers even more. https://t.co/l726t4U4RR pic.twitter.com/NeARz3lRiP
— FatMan (@FatManTerra) July 24, 2022
Voyager filed for bankruptcy on July 5 in the Southern District of New York for default. This was triggered by the crypto hedge fund 3AC, which was unable to repay a $650 million loan.
On Friday, the three companies, led by FTX CEO Sam Bankman-Fried Voyager, offered a deal that would see Alameda acquire all of Voyager’s assets and use FTX or FTX US to sell them and share in those of Voyager to distribute to users affected by the insolvency.
In a press release from FTX said Bankman-Fried said his suggestion is a way for Voyager users to recoup their losses and leave the platform behind:
“Voyager’s customers did not want to become bankrupt investors with unsecured claims. The goal of our joint proposal is to find a better solution for a bankrupt crypto company.”
Bankman-Fried reiterated on Twitter Sunday his company’s rationale behind the suggestion that to take over Voyager. He explained that since bankruptcy proceedings “can take years,” Voyager’s customers “have been through enough already” and should be able to claim their assets as soon as possible if they want to.
13) Anyway: in the end, we think Voyager’s customers should have the right to quickly claim their remaining assets if they want, without rent seeking in the middle.
They’ve been through enough already.
— SBF (@SBF_FTX) July 25, 2022
On Sunday, Voyager’s attorneys said the deal, which purportedly aims to compensate Voyager users, was essentially just a liquidation of Voyager’s assets “in a way that would benefit AlamedaFTX.”
It also outlined six ways the proposal could “harm customers”, including the tax ramifications for capital gains, the unfair capping of the value of Voyager users’ accounts to their July 5th value, and the actual abolition of the VGX token. thereby “immediately destroying more than $100 million in value.”
“The AlamedaFTX proposal is nothing more than liquidating cryptocurrencies in a way that favors AlamedaFTX. It is a bad offer disguised as a white knight bailout.”
The letter also dismissed speculation that the existing relationship between the two companies would give AlamedaFTX a better chance of winning takeover bids: “Nothing could be further from the truth as this response demonstrates.”
Bankman-Fried has made takeover bids for several companies throughout the bearish crypto market. On July 1, Zac Prince, CEO of centralized crypto lender BlockFi, signed a deal for FTX that would see the company receive a $240 million loan. There was also a takeover option worth a total of 640 million US dollars.
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