Celsius Network remains open to other bids after NovaWulf offer
5:50 pm Wednesday, March 08th, 2023
By Dietrich Knauth
(Reuters) -Bankrupt crypto lender Celsius Network on Wednesday revealed that it was speaking to another potential buyer and will seek additional bids, despite having an offer in hand from asset manager NovaWulf Digital Management.
Celsius attorney Chris Koenig said at a hearing in bankruptcy court in Manhattan that the company remains open to better offers, and that it and its creditors committee met with a potential buyer two days ago to review an alternate proposal.
At the hearing, the New Jersey-based lender asked U.S. bankruptcy judge Martin Glenn, who is overseeing Celsius’ Chapter 11, for more time to submit a bankruptcy restructuring plan built around the NovaWulf deal, which would cash out customers with less than $5,000 in crypto deposits and hand ownership of the company’s remaining assets to customers with larger accounts.
Glenn agreed to give Celsius an extra three weeks to file a Chapter 11 plan.
With NovaWulf’s offer in hand, Celsius should be able to exit from bankruptcy by June, less than a year after it filed for Chapter 11, Koenig said.
If Celsius chooses an alternate bidder, Koenig said, it intends to offer NovaWulf up to $20 million in breakup fees.
“If there is a higher offer, it will be because of the floor set by NovaWulf,” Koenig said.
NovaWulf declined to comment on Celsius’s solicitation of other bids.
Crypto lenders such as Celsius boomed during the COVID-19 pandemic, but many companies in the highly interconnected sector went bankrupt in 2022.
Celsius filed for U.S. bankruptcy in July after freezing customer withdrawals. Celsius said at the time that it had more than 1.7 million registered users and approximately 300,000 active users with account balances greater than $100.
(Reporting by Dietrich Knauth; Editing by Alexia Garamfalvi and David Gregorio)
