- Vauld stated in an email to its creditors that its talk with Nexo about a potential acquisition was unsuccessful.
- Nexo dispelled the rumor of a complete termination of its deal with Vauld in a later statement.
- Earlier, Nexo offered to acquire Vauld to save the lender from bankruptcy, as it owed its creditors $402 million.
- Vauld intends to meet its January 20 deadline to submit a restructuring plan.
There are indications that the ongoing negotiations between crypto lenders, Vauld and Nexo over a possible acquisition of the former have suffered a setback. In a Monday email by Vauld to its creditors, the troubled crypto lender insisted that its talks with Nexo had been unsuccessful.
This revelation by Vauld ignited controversies and speculations that the duo might have terminated the potential deal. Although, Nexo, in a later statement, dispelled the rumor about the termination of its ongoing deal with Vauld.
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Nexo explained the constraints that have continued to restrain the deal from concluding.
“Despite our genuine intention to help as promptly as possible, the firm’s transaction team faced daily challenges, such as receiving slow and incomprehensive financial and legal due diligence information and encountering bias from the process administrator, Kroll (Singapore), ” Nexo noted.
According to Nexo, the Singapore administrator was favoring an active management arrangement over a lending arrangement. Nexo, however, argues that such a move forces the creditors to seek aggressive returns to recoup their losses.
Nexo co-founder Kalin Metodiev expresses reservations over the handful of people who seek to influence and limit creditors from making their best decisions.
"We were hoping that the bad actors have mostly departed the blockchain space, but it is obvious that, as a community, we still have work to do," Metodiev said.
Side Notes of the Potential Acquisition of Vauld
Recall that Vauld plunged into liquidity in the wake of the prevailing bear market in June. This forced the lender to halt withdrawals and file for protection against creditors and lawsuits in a Singapore court.
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According to findings, Vauld owes its creditors $402 million. However, to save the lender from the crisis, Nexo offered to acquire it. Since then, negotiations have been ongoing over the potential acquisition of the firm.
In early December, Nexo reportedly submitted a revised proposal for the acquisition to Vauld.
However, against all odds, Vauld seeks to meet up with its January 20 ultimatum to present a restructuring plan to its creditors.
On the Flipside
- According to reports, Nexo didn’t reply to due diligence requests for Vauld’s solvency assessment that would reassure its creditors.
- Furthermore, Vauld pointed out Nexo’s Dec. 5 announcement that it would terminate its U.S. service, possibly leaving Vauld’s customers in the country without addressing their claims.
Why You Should Care
The Terra-Luna crisis of June 2022 affected many firms, including crypto lender Vauld. If the firm fails to present a restructuring plan by January 20, it may file for bankruptcy, resulting in another bear market victim.
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