Voyager rejects Alameda buyout offer because it ‘harms customers’
Central crypto lender Voyager Digital Holdings has rejected an offer from FTX and its investment arm Alameda Ventures to buy its digital assets on the grounds that the actions “do not increase value” and may “harm customers.”
In a rejection letter filed in court on July 24 as part of ongoing bankruptcy proceedings, Voyager’s attorneys decried the offer announced by FTX, FTX US and Alameda on July 22 to purchase all of Voyager’s assets and outstanding loans — except for non-performing loans. loan to 3AC.
The letter states that publishing such offers could jeopardize any other potential deals by sabotaging a “coordinated, confidential and competitive bidding process,” adding that “AlamedaFTX violated numerous obligations to debtors and the Bankruptcy Court.”
Voyager representatives suggested that their proposed plan to reorganize the company is better because they say it will immediately save all of their customers’ money and as much of their cryptocurrency as possible.
You’ve all heard the terms “hero,” “rescue,” “rescue,” and “help” in reference to FTX’s rescue of distressed companies. Voyager, one of the companies mentioned above, disagrees – they think the SBF deal is too predatory and will hurt customers even more. https://t.co/l726t4U4RR pic.twitter.com/NeARz3lRiP
– FatMan (FatManTerra) 24 July 2022
Voyager filed for bankruptcy on July 5 in the Southern District of New York for more than $1 billion in bankruptcy after crypto hedge fund Three Arrows Capital (3AC) defaulted on a $650 million loan from the company.
On July 22, the three companies associated with FTX CEO Sam Bankman-Fried offered Voyager a deal that would see Alameda take over all of Voyager’s assets and use FTX or FTX US to sell and distribute them proportionally to users affected by the bankruptcy.
In an FTX press release, Bankman-Fried He said That his suggestion was a way for Voyager users to recover their losses and move forward from the platform:
“Voyager customers have not chosen to be bankruptcy investors with unsecured claims. The goal of our joint proposal is to help create a better way to resolve insolvent crypto businesses.”
Bankman-Fried doubled down on his company’s justification for its proposal to acquire Voyager on Twitter route Late on July 24th. He stated that Voyager’s clients “have already gone through enough” and should be able to claim their assets if they want to sooner rather than later because bankruptcy proceedings “could take years.”
13) Anyway: Ultimately, we believe that Voyager customers should have the right to quickly claim their remaining assets if they want to, without looking for a rent in the middle.
They’ve had enough already.
– SBF (SBF_FTX) 25 July 2022
On Sunday, Voyager’s lawyers said that the deal, which aims to make full Voyager users, is essentially just liquidating Voyager’s assets “on a basis that benefits AlamedaFTX.”
It also outlined six ways the proposal could “harm customers,” including capital gains tax consequences, an unfair cap on the value of each Voyager user account of July 5, and the effective disposal of the VGX token, which would “destroy in excess of It’s worth about $100 million right away.”
“The proposal of AlamedaFTX is nothing more than a liquidation of cryptocurrency on the grounds that benefits AlamedaFTX. It is a low-ball effort worn as a rescue of the white knight.”
The letter also refuted speculation that AlamedaFTX has a higher chance of winning takeover bids due to the ongoing relationships between the two companies, saying, “Nothing could be further from the truth as evidenced by this response.”
Bankman-Fried has been at the center of other takeover talks in the midst of a dramatic bear market. On July 1, the CEO of another central crypto lender from BlockFi, Zac Prince, drafted a deal for FTX to send $240 million in credit to the company, with a purchase option totaling $640 million.
Related: SBF: Crypto Winter Ends, FTX Turns Profit as Lender of Last Resort
On July 20, Cointelegraph reported that Bankman-Fried was seeking $400 million in funding for FTX and FTX US to raise their valuations to $32 billion and $8 billion, respectively. New funding rounds are expected to support acquisitions of other crypto firms.