- Last year, Galaxy abandoned a $1.2 billion bid to purchase BitGo.
- Due to BitGo’s refusal to submit the financial documents in time, the court favored Galaxy.
A lawsuit filed against Galaxy Digital, a cryptocurrency investment business, was recently rejected, meaning that it would not have to pay damages related to its broken acquisition deal with crypto custodian BitGo. When announcing the court’s decision to throw out the lawsuit, Galaxy said that it was “pleased” with the result.
The firm tweeted:
“Now is the time for all of us to work together and focus on the task at hand: Upgrading the global financial system in a manner that promotes innovation and protects investors and consumers alike.”
Last year, Galaxy Digital, backed by seasoned Wall Street investor Mike Novogratz, abandoned a $1.2 billion bid to purchase BitGo. The corporation said it made the call because the target of its purchase had missed a deadline for submitting audited financial accounts.
BitGo, however, has said that it would sue Galaxy since the merger deal is not set to expire until the end of the year. Due to BitGo’s refusal to submit the financial documents, a vice chancellor of the Delaware Chancery Court ruled last week that Galaxy had a “valid basis” to terminate the proceedings.
Backed Out of Merger Due to Losses Claim
The $1.2 billion acquisition of BitGo by Galaxy was initially announced in May of 2021. If the deal had gone through, it would have been one of the largest in the cryptocurrency sector. In May of 2022, Galaxy said that closing on the deal was anticipated by the end of the year.
Then, in August, it said the transaction was off. Galaxy had already revealed $554 million in unrealized losses on its crypto assets for the second quarter of that year, thus this news came only a week after that disclosure.
BitGo filed a lawsuit in the Delaware Chancery Court back in September, alleging that Galaxy backed out of the merger because of its losses and its aspirations to go public. BitGo was demanding $100 million in damages.
