Concord Acquisition Group Extends $9 Billion Buyout Deal With USDC Issuer Circle
Over the years, Circle has been laying diverse plans to boost and ensure robust growth for the firm and USDC. As a result, it made an acquisition plan of $9 billion. As per Circle CEO Jeremy Allaire, the goal was for the acquisition to go public in December 2022 following the deal’s close.
Circle Internet Finance is a crypto finance firm that provides a platform for users to engage in crypto activities such as trading, investing, and raising funds using open crypto technologies. It is the issuer of the world’s second-largest stablecoin, USD Coin (USDC).
SPAC To Delay Circle’s Acquisition Till 2023
However, Concord Acquisition Group, a particular purpose acquisition company (SPAC), plans to delay the process further. The SPAC revealed in its filing with the US SEC that Circle’s acquisition is extended to January 2023.
The slated completion period for the acquisition was in December this year. However, this is due to the several delays in closing the deal since 2021.
From its filing, the SPAC requires approval from stockholders on its proposal to enable the acquisition delay. Also, stockholders will vote on a different proposal to allow the chairman to delay the acquisition further on the grounds of insufficient votes for the approval of the initial submission.
The board suggests stockholders approve the delay. This will offer them the opportunity of being part of the investment.
Reasons For Circle Acquisition Delay
In July, the CEO of Circle, Jeremy Allaire, announced that the Q4 of the year would mark the deal’s closure. Also, the public listing is meant to be in Q4 together with Concord Acquisition Group.
In June, the acquisition was delayed due to the decline in the crypto market and regulatory control on stablecoins. Subsequently, the tightening stance of regulators remained unfazed, followed by introduction of the new asset class. Also, other key players in the acquisition include the continued fluctuations in the crypto market and the Fed’s stance on interest rate hikes.
But Circle revealed that the delay is linked to the SEC. Circle mentioned its anticipation of completing all necessary qualification processes with the regulator to become a listed firm. However, the SEC has been skeptical about issues like trust, accountability, and transparency regarding Circle.
Decline In USDC Market Cap
Following the crypto crash in the first half of the year, it has not been relatively easy for the Circle’s stablecoin, USDC. The coin witnessed a massive decline in its market cap as it went under 50 billion.
At press time, the USDC market cap sits at $43.39 billion. The stablecoin currently ranks 5th among the top crypto assets based on its market capitalization.
The September drop for USDC was due to the panic sell-off from whales and other investors of the USDC holdings. This happened during Tornado Cash’s sanctions.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.