The company behind stablecoin USDC has terminated a $9 billion SPAC merger which would have seen it float on the New York Stock Exchange.
Circle announced plans in July 2021 to merge with Concord Acquisition Corp – specially created for the deal – with both entities acquired by a new Irish holding company.
Co-founder Jeremy Allaire was to have remained as CEO of the company while former Barclays chief executive Bob Diamond, chairman of Concord and CEO of Atlas Merchant Capital, was to join the board.
The deal was anticipated to close in the fourth quarter of that year, but a renegotiation of the agreement then took place in February 2022 which doubled the valuation of Circle to $9bn.
The decision to call it off was mutual, according to Circle, who announced $400 million of Series E funding in April led by BlackRock, Fidelity, Fin Capital and Marshal Wace LLP which valued the company at $3bn.
Circle runs USD Coin, whose price is tied 1:1 to the US dollar. The Centre Consortium – founded by a partnership between Circle and crypto exchange Coinbase – holds the dollar equivalent of every unit of the cryptocurrency in reserve, either cash or short-term US Treasury bonds.
“Circle plays a key role in the blockchain’s disruption of financial services,” said Diamond. ”I remain confident in Circle’s regulatory-first approach to building trust and transparency in the financial industry, which has never been more important, and I will continue being an advocate for the company as it continues to grow.”
Termination of the proposed business combination has been approved by the board of directors of both Concord and Circle.
“Concord has been a strong partner and has added value throughout this process, and we will continue to benefit from the advice and support of Bob Diamond and the broader Concord team,” said Allaire.
“We are disappointed the proposed transaction timed out, however, becoming a public company remains part of Circle’s core strategy to enhance trust and transparency, which has never been more important.”
Circle became profitable in the third quarter of 2022, with total revenue and reserve interest income of $274m and net income of $43m. Circle also ended the quarter with close to $400m in unrestricted cash.