Cryptocurrency lending company Nexo has initiated a process to potentially acquire the company after rival Vauld abruptly stopped customer withdrawals on Monday.
Nexo Plans to Acquire Whole Cryptocurrency Company Vauld
Sharing the news privately with The Block on Tuesday, Nexo said it has signed an indicative specification with Vauld with a plan to acquire up to 100% of the Singapore-based company.
The contract gives London-based Nexo a special 60-day reconnaissance period during which it will do due diligence.
“We need to see exactly what’s on their records and it will take some time, but as we have a special discovery period, we are the only ones dealing with them right now,” Nexo co-founder Antoni Trenchev said in an interview.
As reported Monday, Vauld is in financial trouble. bitcoin and after the collapse of cryptocurrencies, the company suspended all withdrawals, trading and deposits and hired legal and financial advisors for potential restructuring options.
Withdrawals of the company’s customers are currently suspended.
Nexo Will Make Its Final Decision After Examining Vauld’s Records
Trenchev said Nexo may restructure or refinance Vauld depending on how the due diligence process is going.
That is, if Vauld has some assets staked for longer periods of time or has made long-term investments, Nexo can take them and provide instant liquidity. On the other hand, if assets were lost, Nexo could potentially replenish them if it made sense.
Trenchev continued his statement on the subject as follows:
“We have to consider this in the context of whether, if we step in, can we restructure the business so that it can be functional again so that Vauld, under the Nexo umbrella, which is profitable as a company, can also become profitable.”
As for why Nexo is interested in Vauld, Trenchev said Vauld “has great influence in India and Southeast Asia, which are important markets for them.”
Founded in 2018 by Darshan Bathija and Sanju Kurian, Vauld is headquartered in Singapore and most of its team is based in India. Bathija said that when Vauld was at its strongest, it managed close to $1 billion in assets.
Nexo Tried to Buy Celsius Before
Vauld isn’t the only embattled cryptocurrency company Nexo has come into contact with. Last month, Nexo offered to buy the assets of struggling rival Celsius. The offer remained open for a week and ended because Celsius was not interested in making a deal.
But Vauld seems to be on the case. “Operating under the Nexo umbrella immediately puts us in a strong position to continue to honor our fiduciary obligations to our customers, while also implementing both companies’ ambitious roadmaps regardless of market conditions,” Bathija said in a statement.
*Not investment advice.