The sudden collapse of FTX.com all but derailed its plan to spend $1.4 billion to buy the cryptocurrency assets of bankrupt Voyager Digital Holdings Inc..
Struggling to still clinch its Chapter 11 proceedings with a sale, Voyager said in a joint statement Friday with its creditors’ committee that it “has reopened the bidding process for the company and is in active discussions.” with other bidders”.
“The non-boutique provisions of the asset purchase agreement between Voyager and FTX US are no longer binding,” Voyager said.
More than 130 entities linked to FTX and trading company Alameda Research Ltd. filed for Chapter 11 on Friday at the end of a tumultuous week for Sam Bankman-Fried’s crypto empire. And questions immediately surfaced about what this means for Voyager creditors who were counting on an ongoing purchase of their crypto holdings by FTX US.
FTX emerged in late September as the winning bidder for the purchase of all cryptocurrencies on the Voyager platform, giving Voyager customers a sense of relief that they would see around 72% recovery on their receivables. arising from account balances. Building on the sale to FTX, Voyager filed a plan to conclude its Chapter 11 proceeding in October.
“They were going to be the savior of Voyager, said bankruptcy attorney Manny Grillo of Allen & Overy LLP.
An official committee representing Voyager’s unsecured creditors, which backed the sale of FTX, said in a tweet on Thursday that no part of the deal had been consummated. The committee was taking the necessary steps “to protect the interests of creditors”, he said.
A lawyer for the committee did not immediately respond to a request for comment.
Even before FTX’s bankruptcy, other bidders interested in Voyager’s assets could still submit bids. With FTX collapsing, this would likely be the only viable option for Voyager to avoid liquidation.
Last month, Judge Michael E. Wiles of the U.S. Bankruptcy Court for the Southern District of New York approved a sale agreement that would allow Voyager to rescind its sale to FTX if it received a higher offer.
“Other companies had participated in the September auction for Voyager assets and may reappear and reaffirm their interest in Voyager,” BakerHostetler attorney Teresa Goody Guillén said in an email Friday.
Crytpo Exchange CrossTower, which was competing with FTX to bid on Voyager’s assets, told Wiles at the time that it would continue to bid.
“For Voyager, it changes the whole landscape of the case,” said David Prager, head of the U.S. restructuring advisory practice at Kroll LLC.
The case is In re Voyager Digital Holdings Inc., Bankr. SDNY, No. 22-10943, 11/11/22.