Crypto lender Nexo on Tuesday announced it has signed an indicative term sheet with its rival Vauld to acquire a 100% stake in the company.
The agreement grants Nexo a 60-day exclusive exploratory period related to its intended acquisition of Vauld, pending a satisfactory outcome of the due diligence process.
Related Link: Vauld Halts Crypto Withdrawals, Citing Market Conditions
Wall Street Banks Hired To Oversee Acquisition: Nexo said it has hired two major Wall Street banks to advise it on the acquisition.
“Upon successful completion of the transaction, Nexo plans to acquire up to 100% of Vauld and reorganize its future operations with the aim to accelerate its deeper presence in Asia,” Nexo stated.
Current market conditions are to a large degree reminiscent of the Bank Panic of 1907, characterized by excessive leverage in the system, an overabundance of companies in trouble and no lender of last resort, the company said.
“We sympathize with all affected by the drastic market downturn. However, difficult times always teach us the importance of business model viability and prudent risk management. It is inevitable that the industry leaders will navigate out of the current crisis on the foundation of competitive strength, discipline, and uncompromising responsibility to customers,” Tatiana Metodieva, Nexo’s head of corporate finance and investments, said.
Nexo Seeks To Alleviate Withdrawal Limits: Nexo said it aims to provide immediate assistance and alleviate withdrawal limitations put in place on Vauld’s platform and concurrently explore the integration of wider retail and institutional product range.
“Operating under the Nexo umbrella puts us instantly in a position of strength to continue the execution of our fiduciary obligations to our customers and at the same time to execute upon both companies’ ambitious roadmaps, regardless of the market conditions,” Vauld’s Darshan Bathija said.
Vauld, established in 2018, on Monday announced it was suspending withdrawals, trading and deposits on its platform due to the financial challenges it was facing on account of volatile market conditions and financial difficulties of its business partners.
