{Heavy} Due to regulatory influence, the largest acquisition deal in the Bitcoin field - Luyitong's acquisition of Canaan Creative failed

Chinese manufacturer Luyitong’s planned acquisition of bitcoin mining hardware company Canaan Creative has fallen through.

The deal was said to have been called off due to concerns from regulators at the Shenzhen Stock Exchange, which had been considering whether to approve the acquisition, according to a report in June.

Representatives from Canaan said exchange officials rejected the deal after months of auditing, citing risks and uncertainties surrounding the company and bitcoin technology. Luyitong did not immediately respond to requests for comment.

There were signs that things might go wrong when the acquisition was first announced, with Shenzhen exchange officials beginning to scrutinize the deal, according to local reports.

If approved, the acquisition would be the largest to date in the bitcoin space, involving a publicly traded electronics maker and one of the earliest bitcoin mining hardware startups.

Canaan Creative's representative still made a positive statement, saying that the company will become stronger after this months-long audit.

Canaan Creative CEO Zhang Nangeng said in a statement:

“Although the company has invested a lot of time and resources to complete this acquisition, these efforts have not been in vain. This will benefit our future development. Canaan’s internal management structure is more solid, and our public image has been refreshed, allowing our product channels to provide robust, reliable and efficient Bitcoin technology solutions to the world.”

Canaan is best known for their Aualon line of Bitcoin application-specific integrated circuits (ASICs). The company was the first to enter the Bitcoin ASIC market, permanently changing the landscape of competing parties adding blocks to the Bitcoin network.

The company said that although the acquisition deal did not materialize, they are still planning to launch a 16nm Bitcoin ASIC.

According to earlier reports, listed company Luyitong plans to issue 81.379 million shares at 24.57 yuan per share in a private placement and pay 1.06 billion yuan in cash, totaling 3.06 billion yuan (466 million US dollars) to acquire 100% of Canaan Creative's equity.