Nexo Offers to Acquire Vauld Group after Celsius's Cold Treatment
Godfrey Benjamin Jul 06, 2022 03:25
Nexo’s plan to buy a cryptocurrency lender may be coming to fruition as the company has shown interest in acquiring Vauld Group.
Nexo’s plan to buy a cryptocurrency lender may be coming to fruition as the company has shown interest in acquiring Vauld Group.
This development comes after Vauld Group announced earlier this week that it has halted withdrawals and other operations on its platform in the wake of the ongoing onslaught in the digital currency ecosystem.
According to a report from The Block, Nexo has signed an indicative term sheet with Vauld with a plan to acquire up to 100% of the Singapore-based company. Without financial terms revealed, the company said it will review Vauld Group’s balance sheet over the next 60 days in order to ascertain how best to support the ailing company.
"We have to see what exactly is on their books and it's going to take a little while," Nexo co-founder Antoni Trenchev said in an interview. "But since we have the exclusive exploratory period, we are the only ones looking at them right now."
As a crypto lending platform, Vauld Group said it became severely distressed when it witnessed massive withdrawals to the tune of $198 million following the collapse of Terraform Labs’ LUNA and UST digital currencies. As it was unable to handle the liquidity pressures, it had to suspend its core operations.
According to Trenchev, Nexo will examine all aspects of the company’s previous asset base including whether it has long-term staked coins or other investments.
"We have to view it in the overall context of if we step in, can we restructure the business so that it is functioning again, so that it is profitable within the Nexo umbrella, which as a company is profitable and whether we can accumulate that," Trenchev said.
The consideration for Vauld Group is strategic for Nexo which wishes to expand its operations in India and other Asian markets where the former has active operations. The proposed acquisition of Vauld Group comes after Celsius Network gave Nexo a cold treatment when it offered to buy out its collateralized loan products last month.
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