HK’s GSR Capital buys into Overstock/tZERO blockchain vision
13 August 2018 Salt Lake City
Image: Shutterstock
Overstock.com, a Utah-based online retailer, has reported that it and t0.com (tZERO), 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.com says it sells a broad range of products at low prices, including furniture, décor, rugs, bedding, and home improvement products.
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.
tZERO is a majority-owned subsidiary of Overstock.com. It focusses on the development and commercialisation of fintech-based on cryptographically-secured, decentralised ledgers, which are more commonly known as blockchain technologies.
Overstock.com says that since its inception, tZERO has pioneered efforts to bring greater efficiency and transparency to capital markets through the integration of blockchain technology.
In this transaction, GSR Capital agreed to buy up to 3.1 million shares of OSTK common stock at a 5 percent discount to the closing share price on 1 August. GSR Capital will also invest up to $270 million for up to 18 percent of tZERO's equity at a valuation of $1.5 billion.
Additionally, Capital committed to buying from Overstock $30 million in tZERO Security Tokens. These 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.
The security token purchase agreement replaces a GSR letter of intent previously announced on 29 June.
The equity transactions are subject to definitive documentation and other customary closing conditions. GSR Capital has certain rights to allocate a portion of the investments to third-party players.
Said tZERO CEO Saum Noursalehi: "The tokenisation of securities has the potential to disrupt global capital markets responsible for moving hundreds of trillions of dollars. Together with our partners, we will globalise our blockchain-based platform, bringing more efficiency, liquidity, and trust in capital markets."
Patrick Byrne, founder and Chairman of tZERO, also founder and CEO of parent company Overstock.com, said: "GSR Capital has the prescience to understand the disruptive power of blockchain capital markets.”
"They are aligned with our vision for the future of capital markets built upon the speed, trust, and security of the blockchain,” he added. “And most importantly, they think big, and want to help us scale this vision globally as quickly as possible."
GSR Capital chairman and founder, Sonny Wu, expressed excitement at partnering with tZERO in its effort to expand the global footprint for blockchain-enabled asset trading.
He said: “We have a long-term view on how we want to scale this platform on a global basis.”
GSR (shorthand for Golden Sand River) was founded in 2004 by Wu and Richard Lim.
On 13 August, 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 US.
Overstock.com says it sells a broad range of products at low prices, including furniture, décor, rugs, bedding, and home improvement products.
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.
tZERO is a majority-owned subsidiary of Overstock.com. It focusses on the development and commercialisation of fintech-based on cryptographically-secured, decentralised ledgers, which are more commonly known as blockchain technologies.
Overstock.com says that since its inception, tZERO has pioneered efforts to bring greater efficiency and transparency to capital markets through the integration of blockchain technology.
In this transaction, GSR Capital agreed to buy up to 3.1 million shares of OSTK common stock at a 5 percent discount to the closing share price on 1 August. GSR Capital will also invest up to $270 million for up to 18 percent of tZERO's equity at a valuation of $1.5 billion.
Additionally, Capital committed to buying from Overstock $30 million in tZERO Security Tokens. These 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.
The security token purchase agreement replaces a GSR letter of intent previously announced on 29 June.
The equity transactions are subject to definitive documentation and other customary closing conditions. GSR Capital has certain rights to allocate a portion of the investments to third-party players.
Said tZERO CEO Saum Noursalehi: "The tokenisation of securities has the potential to disrupt global capital markets responsible for moving hundreds of trillions of dollars. Together with our partners, we will globalise our blockchain-based platform, bringing more efficiency, liquidity, and trust in capital markets."
Patrick Byrne, founder and Chairman of tZERO, also founder and CEO of parent company Overstock.com, said: "GSR Capital has the prescience to understand the disruptive power of blockchain capital markets.”
"They are aligned with our vision for the future of capital markets built upon the speed, trust, and security of the blockchain,” he added. “And most importantly, they think big, and want to help us scale this vision globally as quickly as possible."
GSR Capital chairman and founder, Sonny Wu, expressed excitement at partnering with tZERO in its effort to expand the global footprint for blockchain-enabled asset trading.
He said: “We have a long-term view on how we want to scale this platform on a global basis.”
GSR (shorthand for Golden Sand River) was founded in 2004 by Wu and Richard Lim.
On 13 August, 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 US.
NO FEE, NO RISK
100% ON RETURNS If you invest in only one securities finance news source this year, make sure it is your free subscription to Securities Finance Times
100% ON RETURNS If you invest in only one securities finance news source this year, make sure it is your free subscription to Securities Finance Times
