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Crypto Exchange Huobi Acquires Public Firm for $70 Million

Crypto exchange Huobi has completed an acquisition deal to become the largest shareholder of a public firm listed in Hong Kong, inching a step closer to a possible back-door listing.

Pantronics Holdings, the acquired firm, released a statement on Aug. 29 that Huobi Group completed the deal by having purchased about 199 million of its shares via two of the group’s subsidiaries – Huobi Capital and Huobi Universal.

With that amount, Li Lin, chairman of Huobi Group and controller of the two subsidiaries, now owns 66.26 percent of Pantronics and is effectively the largest individual substantial shareholder.

The deal could further give Huobi the opportunity of a back-door listing in the future – a process where a private firm enters the secondary financial market by purchasing a major number of shares of a public company.

Based on the announcement, the transactions were made at an average price of HK$2.72 (or $0.35) per share with a total amount close to $70 million. Yet, the number of shares acquired appear to fall short of what the exchange intended.

As CoinDesk previously reported, in a disclosure of interests filed by Pantronics on Aug. 21, Huobi was seeking to purchase 73.73% of the firm’s ordinary shares which would have cost a total of $77 million. Pantronics’ shareholding disclosures were further amended on Aug. 28 to reflect the change.

A spokesperson for Huobi Group declined to comment on the issue and said the firm is not authorized to disclose information other than what was in the announcement.

Further, the latest document on Wednesday offered a peek into Huobi’s corporate structure such as the ownership percentage by notable investors of Huobi including Sequoia Capital and Zhenfund.

Based on the document, while Huobi Capital is fully owned by Li himself, Huobi Universal’s largest owners include Techwealth (58.44 percent), Sequoia Capital CV IV (23.32 percent) and Zhen Partners Fund I (7.46 percent).

Among them, Techwealth is an investment company, of which Li owns 89.09 percent.

Meanwhile, Sequoia Capital CV IV is a fund that’s solely owned by Sequoia Capital China and Zhen Partners is a venture capital firm launched by Chinese entrepreneur Xu Xiaoping together with Sequoia Capital China.

Huobi image via Shutterstock

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IOST Blockchain Incubator Launches With $50 Million Fund

Bluehill, a startup incubator for global blockchain projects, launched on Thursday after raising $50 million to support the IOST blockchain ecosystem.

The firm said in a release that it is now taking in applications from startups on a rolling basis and on average invests $500,000 into a project with “both seed investments of $100,000 and follow-on investments in the low millions.”

Notably, the startup claims it will work with Binance Labs and Huobi Capital when investing in companies.

Though its fund will be used to back startups – including their finance, marketing, and recruitment needs – that are built on the IOST ecosystem, Bluehill told CoinDesk in an email that it is “open to all projects irrespective of whether they’re presently building on IOST.”

“Our focus is on backing the best teams early and aligning our interests with theirs right from the start so that we can build trust and familiarity with the most enduring companies,” the firm said.

According to the announcement, Bluehill has already invested in seven decentralized application projects. Among them, six are built on the IOST blockchain while the other one is developing its own blockchain protocol.

Launched in 2017, the IOST protocol seeks to provide a scalable blockchain network for the Internet of Services.

The project has received support from notable investors in China, including Sequoia China, ZhenFund, Huobi, crypto wallet provider Bixin and INBlockchain, the capital firm founded by Chinese crypto tycoon Li Xiaolai.

Bluehill said it now has around 50 staff with offices in Beijing, Seoul, Singapore , Berlin, and San Francisco and aims to expand to over 100 employees by the end of this year.

U.S. dollar image via Shutterstock

The leader in blockchain news, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups.