Galaxy Digital (TSX: GLXY) this morning announced that it has enetered into an arrangement to acquire BitGo in a transaction pegged at $1.2 billion in total consideration. BitGo is an independent digital assets infrastructure provider.
Justification for the massive transaction is predicated on the acquisition making Galaxy Digital the “leading global full-service platform for institutions seeking access to the crypto economy.” Infrastructure provided by BitGo is based around custodian services that have been purpose-built for the crypto segment. The company currently offers wallet products, prime lending, trading, and portfolio management among other offers.
In terms of hard figures, BitGo currently has $40 billion in assets under custody, while having over 400 institutional clients across 150 exchanges. The firm reportedly processes 30 billion monthly transactions while supporting over 400 digital coins.
Total consideration for the acquisition is to consist of $265 million payable in cash, as well as the issuance of 33.8 million common shares of Galaxy Digital. Cash payments are to be self funded, with the funds to be on a deferred delivery schedule over a period of twelve months.
The transaction is expected to close in the fourth quarter of 2021, subject to the approval of shareholders, as well as the restructuring of Galaxy Digital to a Delaware-based entity.
Galaxy Digital last traded at $34.25 on the TSX.
Information for this briefing was found via Sedar and Galaxy Digital. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
