Nexo Cancels Its Acquisition of Troubled Crypto Lender Vauld

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Singapore-based Vauld, a troubled cryptocurrency lender, said that takeover talks with competitor Nexo have ended because Vauld hasn’t responded to due diligence requirements for a solvency assessment that would guarantee creditors.

As part of the suggested strategy to restructure the company, “we were earlier examining a possible purchase by Nexo,” Vauld revealed to the website Coindesk through a private Twitter message. Coindesk focuses on cryptocurrencies. “To offer a very basic description of the situation, the fruit of our negotiations with Nexo has sadly not been realized,”

In addition, if the takeover agreement had gone through, Nexo’s decision to stop providing services in the United States would have put the status of Vauld clients and their claims in jeopardy. Also, it has been said that Nexo did not give Vauld clients a way out, which was important for the reorganization.

It took just five months for the transaction to fall through after Nexo and Vauld inked a preliminary agreement to investigate the possibilities of an acquisition. Although Vauld did not emphasize the effect of the agreement termination on its continuing restructuring, the deadline to come up with a restructuring plan was missed by less than a month. Vauld did not highlight the impact of the deal termination on its current restructuring.

The acquisition of Vauld is still important to Nexo.

Nexo, on the other hand, is not going to give up on its efforts to complete this transaction just yet. “Nexo has not given up on its attempt to save Vauld and help its creditors recover the maximum possible platform funds,” Kalin Metodiev, Nexo’s co-founder and managing partner, wrote in an email that was sent to a cryptocurrency publication. “Nexo has not given up on its attempt to save Vauld and help its creditors recover the maximum possible platform funds.”
According to reports, the two businesses did not reach an agreement with one another to formally terminate the contract, which is necessary for doing so.

The problems that Vauld was having became public knowledge when, at the beginning of July, the platform halted all activity, including trading, deposits, and withdrawals, claiming financial constraints and looking into possibilities for reorganization. After that, the business went to a court in Singapore to ask for a protection from its creditors known as a moratorium order, and it was granted one for a period of three months.

Vauld started doing business in 2018, and when it did, it said it had the best interest rates for large cryptocurrency deposits.It offered a range of trading services, including the option to borrow against cryptocurrency assets.

According to a document that was filed in court in July, Vauld owed its debtors a total of $402 million, and the majority (90%) of that debt was incurred by retail investors. Even after the company asked for protection from its creditors, its problems didn’t go away because the Indian government froze its assets, which were worth an estimated $46.4 million.

 

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