Circle and Concord Terminated Their $9 Billion SPAC Combination

Circle Internet Financial and Concord Acquisition Corp mutually terminated their proposed business combination on December 5, 2022, ending the USDC issuer’s attempt to reach the public market through a special-purpose acquisition company under an agreement that assigned Circle a $9 billion equity value.

The executed termination agreement and Concord’s same-day filing with the Securities and Exchange Commission establish that the termination became effective on December 5. Circle remained a private company, while the contemplated combined entity would not obtain the public listing envisioned by the transaction.

The development mattered beyond a single abandoned deal. Circle issued a major dollar-linked stablecoin and had presented public-company status as a way to increase institutional trust and transparency. The termination showed that even comparatively established digital-asset businesses faced difficulty completing public-market transactions during the severe contraction in cryptocurrency and SPAC activity in 2022.

The registration statement never became effective

Circle and Concord first announced a business combination in July 2021. They replaced that arrangement with a revised agreement dated February 16, 2022. The revised terms defined Circle’s company equity value as $9 billion, subject to specified adjustments. That figure was a negotiated transaction valuation—not Circle’s market capitalization, a cash purchase price or a contemporaneous independent appraisal.

Under Concord’s governing documents, the SPAC had until December 10, 2022 to complete a business combination. The agreement contemplated seeking an extension to January 31, 2023 if the SEC had declared the transaction’s Form S-4 registration statement effective. As of December 5, the filing had not become effective.

The termination agreement said that, despite the parties’ efforts, they had been unable to cause the SEC to declare the registration statement effective and therefore could not complete the transaction within Concord’s permitted period. That language documents a failure to satisfy the transaction timetable. It does not establish that the SEC rejected Circle’s business, denied a completed application or made a finding against USDC.

Both companies’ boards approved the mutual termination. Circle chief executive Jeremy Allaire said in the joint announcement that becoming a public company remained part of Circle’s strategy, but that was a management intention on December 5 rather than a new transaction or guaranteed outcome.

Termination carried defined financial obligations

The separation was not costless. The executed agreement required Circle to pay Concord $7,352,203.08 for specified transaction expenses after receiving the supporting invoices or amount-due statement.

Circle also agreed to issue 396,514 ordinary shares to a nominee on Concord’s behalf. The parties assigned those shares an aggregate value of $20 million using the company equity value embedded in the transaction agreement. That was a contractual valuation for settling the termination obligation; it was not evidence that the private shares could be sold for $20 million in a liquid market on December 5.

The parties granted broad mutual releases while preserving obligations associated with the expense payment and share issuance. Concord’s filing additionally described the expected redemption of its publicly held Class A shares and subsequent liquidation, subject to its governing documents and applicable law. Those steps were expected consequences, not all completed actions on December 5.

Circle emphasized operating results

In the joint announcement, Circle said it had become profitable during the third quarter of 2022, reporting $274 million in total revenue and reserve interest income, $43 million in net income and close to $400 million in unrestricted cash at quarter-end.

Those figures were contemporaneous company representations reproduced in an SEC exhibit. They provided Circle’s argument that the failed listing did not equate to an operating collapse, but the short announcement did not provide the complete financial statements, accounting notes or audit evidence needed to evaluate the figures independently.

What the event established

The defensible conclusion on December 5 was narrow: Circle’s $9 billion SPAC route to the public market had ended because the transaction could not be completed within its timetable, with the ineffective registration statement identified as the central procedural obstacle.

The record did not establish a new valuation for Circle, a replacement listing plan, a regulatory judgment on USDC or a change to the stablecoin’s redemption terms. It marked the failure of a major crypto capital-formation transaction at a moment when access to public equity and investor confidence had become materially more constrained.