Two cryptocurrency firms have concluded plans to merge their companies as well as their tokens. To maintain its European expansionary goal, Crypto asset broker Voyager Digital Ltd wants to buy LGO Markets, a France-based crypto exchange with interest in corporate investors.
The merger and acquisition will not be concluded until it has received the right regulatory approval, which could be possible by the end of the year, according to both firms.
The worth of the acquisition will depend largely on the value of LGO Markets’ token as well as Voyager’s shares at closing.
Considering the present market price, it could be in the range of the lower seven figures.
Deal much lower than some top deals this year
With the anticipated value of the Voyager deal, it will be much lower than some other blockbuster deals already concluded this year. Two prominent examples are FXT’s acquisition of Blockfolio in a deal worth $150 million, as well as a mouthwatering $400 million deal by Binance to acquire CoinMarketCap earlier in the year.
However, the Voyager deal is unique because of the merger of both firm’s tokens into one. In most similar deals, the buyer retains its tokens while creating an avenue for holders of the other tokens to convert their old tokens to the new one.
But both of the LGO and VGX tokens will be merged into one newly minted token that features a decentralized finance (DeFi) function and staking with an initial interest rate at 7%.
The new token will provide better utility benefits
Voyager’s chief executive officer and co-founder Steve Ehrlich has commented on the development. He said both firms are taking the conventional merger and acquisition approach where both assets are merged into one.
“We think this is taking the old-school mergers and acquisitions to the token world, which hasn’t been done before,” he revealed in a document.
He also said the new token will offer more utility and benefits to token holders in Europe, the US, and other parts of the world.
Chief executive officer and co-founder of LGO, Hugo Renaudin, revealed to the press that the company took the merging approach to shift focus from institutional clients and provide better service and value to retail clients.
Once the deal is complete and all legal documents have been signed, Voyager said the company will be able to operate in the European market using LGO’s registration with AMF, the French financial market’s regulator. The company also plans to offer one million shares after the merger.
Renaudin also revealed that the company had another option to provide better services to institutional clients, but changed its focus to retail customers after consideration.