CoinDesk Mulling Sale to Bailout Parent Company DCG From Financial Crisis
Digital Currency Group (DCG) admitted receiving multiple offers for buyers interested in CoinDesk. DCG chief executive Barry Silbert admitted receiving offers that exceed $200 million for a subsidiary acquired in a $500000 deal. The offer, estimated to represent a 39,900% return on the initial investment in 2016, coincides with a time when the Silbert-led empire is confronting serious financial challenges.
Coindesk Weighing Sale Options
The crypto media outlet chief executive Kevin Worth disclosed on January 18 that holding open conversations with the parent company, potential partial or whole sale in efforts to strengthen DCG’s balance sheet. Explaining the options, Worth confirmed engaging investment bankers led by financial advisory firm Lazard to enable Coindesk to weigh options sale options.
Silbert-led DCG has reportedly witnessed growing interest from parties seeking to buy out the media outlet. The consideration portrays the DCG empire has been facing serious financial challenges recently. The crisis is evident in Silbert’s January 17 statement to shareholders, informing them DCG was suspending dividends payout. The executive indicated that halting the payments will enable DCG to preserve liquidity and strengthen its financial position.
Exploring the Coindesk sale is inevitable for DCG, with another subsidiary Genesis Global purportedly planning for the bankruptcy filing. Bloomberg reported on January 18 DCG’s lending firm is considering bankruptcy filing after acknowledging $3 billion obligations to creditors. The report shows that debt is the primary contributor to the DCG’s financial woes.
Like Genesis Global, CoinDesk is among the hundreds of crypto-related entities constituting DCG’s portfolio. Also, the portfolio features Grayscale Investments involved in asset management, Foundry advisory entity and Luno crypto exchange.
DCG and Genesis Financial Crisis
DCG and Genesis Global financial crisis traces to the contagion effect of the FTX calamitous downfall first exposed as irregularities by CoinDesk in Alameda Research’s statement of financial position. The discovery would plunge Sam Bankman-Fried’s empire into bankruptcy, dragging other crypto-related firms exposed to the exchange.
The FTX-related liquidity crisis has eroded a significant value of the wider crypto market. Kraken, Crypto.com and Genesis have recently downsized their workforce. Despite laying off 30% of the employees in January, Genesis Global Capital is engaged in talks with creditors over prepackaged bankruptcy arrangements. The development explains the need for DCG to pursue the sale of CoinDesk to parties expressing acquisition interest in the media outlet.
Editorial credit: T. Schneider / Shutterstock.com
Tokenhell produces content exposure for over 5,000 crypto companies and you can be one of them too! Contact at info@tokenhell.com if you have any questions. Cryptocurrencies are highly volatile, conduct your own research before making any investment decisions. Some of the posts on this website are guest posts or paid posts that are not written by Tokenhell authors (namely Crypto Cable , Sponsored Articles and Press Release content) and the views expressed in these types of posts do not reflect the views of this website. Tokenhell is not responsible for the content, accuracy, quality, advertising, products or any other content or banners (ad space) posted on the site. Read full terms and conditions / disclaimer.