Evernorth delayed its Nasdaq debut after shares of the SPAC taking the XRP treasury company public lost half their value.
Armada Acquisition Corp. II, which currently trades under the XRPN ticker, closed Tuesday at $19.20, down 50.3% from $38.65 a day earlier, according to data compiled by StockAnalysis. The shares had traded as high as $53 on Oct. 2 after closing at just $10.58 on Sept. 28.
In an Oct. 6 filing, Evernorth said an administrative delay had pushed completion of its merger with Armada to around Oct. 9 from Oct. 7. Trading of the combined company on Nasdaq is now expected to begin around Oct. 12, instead of Oct. 8. Evernorth said the delay is not expected to affect the closing.
Investors now face a longer wait after a speculative surge in Armada shares began reversing just days before the XRP treasury vehicle was due to formally enter public markets.
A near-quadrupling unwinds in days
XRPN’s rally accelerated after Armada shareholders approved the Evernorth transaction on Sept. 30.
The stock closed at $23.43 on Oct. 1, surged as high as $53 the next day and finished that session at $39.42. It remained at $38.65 on Oct. 5 before collapsing to $19.20 Tuesday.
Even after losing half its value, XRPN remained about 81% above its Sept. 28 close, reflecting how quickly investors had bid up the vehicle ahead of the merger.
Some of that volatility may reflect the shrinking supply of Armada shares available to investors seeking exposure before Evernorth becomes the listed company.
Armada reported 23 million shares subject to redemption at June 30, backed by $241.2 million in its trust account, equivalent to about $10.49 per share, according to its quarterly report filed with the Securities and Exchange Commission (SEC).
Evernorth subsequently said only about $48 million of trust proceeds are expected to remain for the combined company when the transaction closes.
Using Armada’s June redemption value as a rough guide, that amount would correspond to approximately 4.6 million shares remaining from the original 23 million redeemable shares, implying redemptions approaching 80%.
The companies have not yet disclosed the final redemption count, so that figure remains an estimate rather than the confirmed post-merger public float.
Heavy SPAC redemptions can leave relatively few shares available for trading. That can exaggerate price moves when investors pile into a deal and produce an equally sharp reversal once demand fades.
XRPN’s swings therefore offer an imperfect measure of what the fully combined Evernorth will ultimately be worth. Investors are currently pricing a SPAC awaiting transaction completion, rather than the final capital structure of the XRP treasury company.
Evernorth’s 473 million XRP bet moves closer to market
Still, the underlying transaction would create what Evernorth says will be the largest publicly traded company focused primarily on an XRP treasury.
The company expects to hold about 473 million XRP at closing, along with roughly $300 million in gross cash proceeds from the transaction. That includes $225 million from private placements, $30 million from convertible-note financing, and approximately $48 million remaining from Armada’s trust before transaction expenses.
Investors backing the transaction include Ripple, SBI Group, Arrington Capital, Pantera Capital, Kraken and GSR, according to Evernorth’s Oct. 1 announcement.
Evernorth is pitching the vehicle as more than a listed wrapper around an XRP stockpile. Chief Executive Asheesh Birla said the company plans to deploy capital across the XRP ecosystem to increase XRP exposure per share over time.
Evernorth presents that strategy as part of its pitch to investors ahead of the merger. Tuesday’s decline highlights the risk of attaching that premium to a thinly traded acquisition vehicle before investors know exactly how many shares will remain in circulation after closing.
The next disclosures may therefore be more important than the two-day administrative delay itself.
Once the transaction closes, Evernorth should provide a clearer picture of the final redemption count, cash delivered from Armada’s trust and the combined company’s share structure. The merger will also bring other potential sources of equity supply, including Armada’s outstanding warrants, into sharper focus.
Those numbers will give investors a firmer basis for deciding whether XRPN’s remaining premium reflects the value of Evernorth’s XRP strategy or the temporary scarcity of shares available before the deal closes.
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