Bankrupt crypto lender Voyager Digital receives initial court approval to sell its assets to Binance.US in a deal worth roughly $1 billion.
US Bankruptcy Judge Michael Wiles of the Southern District of New York ruled Voyager to execute an asset purchase deal with the Bianace.US and to hold a vote among its creditors about the sale.
Joshua Sussborg, the lawyer representing Voyager, stated that pursuing the agreement with Binance.US would be in the best interests of Voyager’s creditors.
Sussborg noted “We do not want to delay getting money, getting crypto back into our customers hands. Importantly … we also took a very hard look at a standalone self-liquidation … the self-liquidation auction is not an option that is going to put the most money in our customers pockets.”
Sussberg added that Voyager was responding to the U.S. Committee on Foreign Investment in the United States (CFIUS) because Voyager intended to address any issues that could cause CFIUS to oppose the deal.
Last month, CFIUS stated that its review of this deal “could affect the ability of the parties to complete the transactions, the timing of completion, or relevant terms.”
According to a Bloomberg report, the Binance deal includes a $20 million cash payment to buy out the $1 billion in accounts, and a commitment to transfer Voyager’s customers to Binance, if the customers don’t want to cash out the assets.
State securities regulators, the U.S. Securities Exchange Commission (SEC), Alameda Research, etc rejected Voyager’s proposed deal in addition to CFIUS.
Voyager Digital defended its $1 billion proposal to sell assets to Binance.US stating that the objections by these entities fail to identify any transaction that provides a better outcome for Voyager’s creditors.
Despite these objections, Judge Glenn permitted Voyager to proceed, stating that the securities regulators would be able to object in the future to the sale’s final confirmation.
If the deal is blocked by CFIUS, Voyager will be obliged to compensate consumers with the crypto it has on hand, resulting in a smaller payout for Voyager users, according to Sussberg.
Until a court hearing is held on March 2 or shortly thereafter, the agreement won’t be considered final. Customers of Voyager who have been unable to access their funds will receive a 51% capital refund if the agreement with Binance.US is carried out.
Also Read: Binance.US to Acquire Voyager Digital Assets for $1.022B
