Hodlnaut Founders Want to Sell The Firm to Potential Investors: Report
Hodlnaut was one of many firms severely impacted by the collapse of FTX last November, even as the first signs of crack date back to at least as early as May when it lost nearly $190 million in the crash of the Terra ecosystem.
Despite previously downplaying its exposure, Hodlnaut was forced to halt withdrawals in August and enlist third-party interim managers while simultaneously slashing 80% of its employees as part of its cost-cutting measures. But a new affidavit revealed that Hodlnaut is willing to sell the firm.
Searching for “White Knight Investors”
The interim judicial managers, who were appointed to oversee its restructuring last summer, released the sixth affidavit wherein its co-founder Simon Lee proposed that selling the business would serve the best interest of the creditors than liquidating the firm. In this regard, Lee, along with another co-founder Zhu Juntao, has reportedly reached out to several potential “white knight investors,” as per a Bloomberg report.
Lee reportedly said Hodlnaut co-founders believe such a business transaction would “maximize” value for creditors. He also stressed that the company’s user base “can be acquired and on-boarded on digital-asset platforms owned or affiliated to such investors.”
It was earlier reported that potential buyers have expressed interest in Hodlnaut. As such, the Singapore-based lender’s interim judicial managers were contacted by several parties regarding the same.
The development comes almost two months after Hodlnaut creditors rejected a proposed restructuring plan. Instead, the group of creditors, including the Algorand Foundation, believed dissolving the firm and liquidating the assets is a better option.
Hodlnaut Hit by Investigations
Singapore’s law enforcement agents launched an investigation against Hodlnaut in November. As reported earlier, the police suspect the crypto lender’s top executives could have cheated users over the years and committed other crimes.
Prior to that, numerous reports surfaced that accused the company’s directors of making “false representations relating to the company’s exposure to a certain digital token.”
As of December 9th, Hodlnaut Group had outstanding debts of $160.3 million to several companies and entities.
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