GSR Capital to Invest in tZERO at $1.5 Billion Valuation
August 09 2018 - 4:01PM
Full investment up to $404 million upsized from prior LOI on 29
June 2018, consisting of;
Overstock.com, Inc. (NASDAQ:OSTK) and t0.com, Inc. (“tZERO”),
announce that the companies have both signed term sheets with GSR
Capital, a Hong Kong based private equity firm, to
invest up to $374.55 million in exchange for common
equity in blockchain subsidiary tZERO and common equity
in Overstock.com. Overstock and GSR Capital have also entered
into a purchase agreement pursuant to which GSR Capital will
purchase $30 million in tZERO Security Tokens from Overstock.
As part of the term sheet agreement, GSR Capital will purchase
up to 3.1 million shares of OSTK common stock at a five
percent discount to the closing share price on
August 1, 2018. GSR Capital will also invest up to $270
million for up to 18% of tZERO’s equity at a valuation of $1.5
billion (post-money). Additionally, pursuant to a purchase
agreement, GSR Capital will purchase from Overstock $30 million in
tZERO Security Tokens. These tZERO Security Tokens were purchased
by Overstock during
the recently-closed tZERO Security Token Offering in
a non-cash transaction in which Overstock forgave $30 million in
tZERO intra-company debt. GSR’s Security Token purchase agreement
replaces the GSR letter of intent previously announced on June
29, 2018.
The equity transactions are subject to definitive
documentation and other customary closing conditions. They
also provide GSR Capital with certain rights to allocate a
portion of the investments to third-party designees.
“We are honored to have GSR Capital as a strategic investor,”
said tZERO CEO Saum Noursalehi. “The tokenization of securities has
the potential to disrupt global capital markets responsible for
moving hundreds of trillions of dollars. Together with our
partners, we will globalize our blockchain-based platform, bringing
more efficiency, liquidity, and trust to capital markets.”
“GSR Capital has the prescience to understand the disruptive
power of blockchain capital markets,” said Patrick M. Byrne,
founder and Chairman of tZERO, and founder and CEO of parent
company Overstock.com. “They are aligned with our vision for the
future of capital markets built upon the speed, trust, and security
of the blockchain. And most importantly, they think big, and want
to help us scale this vision globally as quickly as possible.”
“GSR Capital is very excited to partner with tZERO in its effort
to expand the global footprint for blockchain-enabled asset trading
including stocks, bonds, commodities, etc. We have a long-term view
on how we want to scale this platform on a global basis,” said GSR
Capital’s Chairman and founder, Sonny Wu.
About Overstock.com
Overstock.com, Inc. Common Shares (NASDAQ:OSTK) / Series A
Preferred (Medici Ventures’ tZERO platform: OSTKP) / Series B
Preferred (OTCQX:OSTBP) is an online retailer based in Salt Lake
City, Utah that sells a broad range of products at low prices,
including furniture, décor, rugs, bedding, and home improvement. In
addition to home goods, Overstock.com offers a variety of products
including jewelry, electronics, apparel, and more, as well as a
marketplace providing customers access to hundreds of thousands of
products from third-party sellers. Additional stores include Pet
Adoptions and Worldstock.com dedicated to selling artisan-crafted
products from around the world. Forbes ranked Overstock in its list
of the Top 100 Most Trustworthy Companies in 2014. Overstock
regularly posts information about the company and other related
matters under Investor Relations on its website,
http://www.overstock.com.
About tZERO
t0.com, Inc. (“tZERO“) is a majority owned subsidiary of
Overstock.com, focusing on the development and commercialization of
financial technology (FinTech) based on cryptographically-secured,
decentralized ledgers – more commonly known as blockchain
technologies. Since its inception, tZERO has pioneered the effort
to bring greater efficiency and transparency to capital markets
through the integration of blockchain technology.
About GSR Capital
GSR was founded in 2004 by Sonny Wu and Richard Lim. Today, “GSR
Ventures”, “GSR United Capital” and “GSR Capital” are three
independent yet complementary teams set up by the partners in 2016
with the aim of sector leadership and going global with unique
investment strategies and resources. GSR Capital has offices in
Beijing, Hong Kong and the USA.
O, Overstock.com, O.com, Club O, Main Street
Revolution, and Worldstock are registered trademarks of
Overstock.com, Inc. O.biz and Space Shift are also
trademarks of Overstock.com, Inc. Other service marks, trademarks
and trade names which may be referred to herein are the
property of their respective owners.
This press release contains certain forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934. Such
forward-looking statements include all statements other than
statements of historical fact. Additional information regarding
factors that could materially affect results and the accuracy of
the forward-looking statements contained herein may be found in the
Company's Form 10-Q for the quarter ended March 31, 2018, which was
filed with the SEC on May 8, 2018, and any subsequent filings with
the SEC.
Media Contact:pr@overstock.com
Investor Contact:ir@overstock.com
SOURCE: Overstock.com, Inc.
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