Circle, a US-based blockchain payment platform developer backed by several corporate investors, agreed to a reverse merger with special purpose acquisition company Concord Acquisition Corp yesterday.
The combined business will be valued at $4.5bn through the deal and will pick up Concord’s listing on the New York Stock Exchange, which it acquired in a $276m initial public offering in December 2020. Circle’s existing shareholders will retain approximately 86% of the merged company’s shares.
The merger is supported by $415m private investment in public equity financing from investors including financial services and investment group Fidelity and hedge fund managers Marshall Wace, Adage Capital Management and Third Point as well as accounts advised by Ark Investment Management.
Founded in 2013, Circle operates a digital payment processing system that leverages a regulated and fully reserved dollar digital currency dubbed USD Coin.
The platform has facilitated more than 100 million transactions representing tens of billions of dollars, according to Circle’s website. The company also runs equity crowdfunding platform SeedInvest.
Jeremy Allaire, Circle’s co-founder, will continue to lead the business as CEO while Bob Diamond, chairman of Concord Acquisition Corp, will join its board of directors. The company had raised at least $686m prior to the deal.
Circle closed a $440m round last month that included cryptocurrency exchange platform FTX, in addition to Fidelity, Digital Currency Group (DCG), Atlas Merchant Capital, Breyer Capital, Intersection Fintech Ventures, Marshall Wace, Pillar VC, Valor Capital Group, Willett Advisors and Michael J Price and Friends.
The company had secured $25m from DCG in July 2020, after raising $110m in a 2018 series E round led by cryptocurrency mining technology producer Bitmain with investment from DCG, Accel, Blockchain Capital, Breyer Capital, General Catalyst, IDG Capital, Pantera Capital and Tusk Ventures.
Breyer Capital and IDG Capital co-led Circle’s $60m series D round, in 2016, which also featured internet group Baidu, online lender CreditEase, car component producer Wanxiang, China International Capital Corporation’s CICC Alpha fund, Everbright, General Catalyst, Sam Palmisano and Glenn Hutchins.
Circle’s earlier investors include investment banking firm Goldman Sachs, Bitcoin Opportunity Fund, Fenway Summer and Oak Investment Partners.