Circle Nixes $9B SPAC Deal With Crypto Market In Tumult

Boston-based Circle Internet Financial called off its proposed merger agreement with special-purpose acquisition company Concord Acquisition Corp. — ending a year-and-a-half long SPAC saga which would have valued the company at $9 billion.

“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,” said Jeremy Allaire, co-founder and CEO of Circle, in a release.

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The news comes as the crypto market continues to reel after the sudden and dramatic collapse of FTX, as well as many investors souring on the SPAC phenomenon that took hold a few years ago.

A SPAC story

Circle’s proposed merger with blank-check firm Concord, which is backed by former Barclays boss Bob Diamond, has been its own long and winding story.

The company — an issuer of USD Coin, a type of stablecoin — announced in July 2021 it would merge with Concord in a deal that would value the company at $4.5 billion.

However, USD Coin’s circulation quickly doubled and in February Circle terminated its previously announced merger agreement and agreed to new terms that doubled the crypto company’s valuation to $9 billion.

That deal was expected to close later this month — and could have been extended into January — but Monday’s announcement slammed the door shut.

In the announcement of the cancellation of the SPAC deal, Circle said it became profitable in the third quarter, with total revenue and reserve interest income of $274 million and net income of $43 million.

The company added it ended the quarter with close to $400 million in cash.

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Illustration: Dom Guzman


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