Circle falls after company, holders offer 10 million shares
[NEW YORK] Shares of Circle Internet Group fell after the second-largest stablecoin issuer and a group of shareholders, including co-founder and chief executive officer Jeremy Allaire announced an offering to sell a combined 10 million shares.
Circle is offering two million shares while the selling shareholders are selling eight million, according to a filing on Tuesday (Aug 12) with the US Securities and Exchange Commission. At the closing price on Tuesday of US$163.21 each, the share sale would raise US$1.63 billion.
The stock declined 6.1 per cent from the closing price to US$153.34 each as at 8.07 pm in post-market trading on Tuesday in New York.
The offering is set to price on Thursday night, according to sources familiar with the matter, who asked not to be identified as the information is not public. A representative for Circle did not immediately respond to a request for comment.
Circle went public in a June initial public offering (IPO) that raised US$1.2 billion, and has seen its stock price rise more than 426 per cent to Tuesday’s close, after a stablecoin bill was signed into law.
The share sale comes within six months of the IPO, a period in which certain early shareholders are typically barred from selling their shares.
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Shareholders can be released from the so-called lock-up agreements when the stock is up substantially from the IPO price and there is clear demand for the shares. Circle’s insiders had agreed not to sell before a few days after the release of the company’s September quarter results, or 180 days after the IPO, whichever came first, according to its earlier filings.
Three of Circle’s institutional backers before the IPO are the biggest sellers in the offering. IDG Capital is offering 1.17 million shares in the offering, General Catalyst is selling 1.12 million shares, and Fidelity Investments is offering 746,707 shares, the filing shows.
Allaire is selling 357,812 shares, and is expected to maintain 23.9 per cent voting power after the offering, the filing shows.
The offering is being led by JPMorgan Chase, Citigroup and Goldman Sachs, the filing shows. BLOOMBERG
