Circle Announced New SPAC Deal To List On NYSE At $9 Billion Valuation
Circle, the issuer of USDC stablecoin, has shared new details regarding its transition to become a publicly trading firm – with a new valuation of $9 billion.
In July last year, Circle announced its plans to go public via a SPAC through a deal with Concord, chaired by ex-Barclays CEO, Bob Diamond. The new deal puts Circle valuation at $9 billion — double from the first deal’s terms that valued it at $4.5 billion.
Since the original deal announcement, USDC’s circulating supply has more than doubled, crossing $52.6 billion at the time of writing. The rise in the USDC supply prompted Circle to reassess its valuation, according to the latest announcement.
The transaction is subject to shareholder and regulatory approvals, and the deal could happen by the end of 2022, after which the new entity would trade on the New York Stock Exchange (NYSE) under the ticker CRCL.
Bob Diamond commented on the deal:
“We continue to believe that Circle is one of the most interesting, innovative and exciting companies in the evolution of global finance and we believe it will have an historic impact on the global economic system.”
Jeremy Allaire, Co-Founder and CEO at Circle, said:
“Circle has made massive strides toward transforming the global economic system through the power of digital currencies and the open internet.
Being a public company will further strengthen trust and confidence in Circle and is a critical milestone as we continue our mission to build a more inclusive financial ecosystem. Making this journey with Concord under our new agreement is a strategic accelerator.”
The new deal’s announcement also talked about the new terms reflected “improvements in Circle’s” financial outlook. Upcoming rate hikes by the Federal Reserve could bump the interest Circle earns on the cash pile underpinning the dollar-backed coin.
In financial filings for the previous deal, Circle noted material weaknesses in its financial statements. The firm said that it overstated compensation expenses due to a payroll issue and over-estimated of convertible debt holdings.
“We cannot assure you that the measures we have taken to date, and actions we may take in the future, will be sufficient to remediate the control deficiencies that led to the material weakness in its internal control over financial reporting or that they will prevent or avoid any potential future material weakness.”
