F-1: Coincheck Group Files for Resale of Ordinary Shares and Warrants Following Business Combination

Coincheck Group N.V. has filed a registration statement for the resale of a substantial number of its ordinary shares and warrants by existing securityholders, following its recent business combination.

Summary

• Coincheck Group N.V. has filed a registration statement for the resale of up to 126,783,590 ordinary shares, 129,611 private warrants, and 129,611 ordinary shares issuable upon exercise of private warrants.
• The filing also covers the issuance of up to 4,860,148 ordinary shares upon the exercise of outstanding public and private warrants.
• The company will not receive any proceeds from the sale of shares by the selling securityholders.
• However, Coincheck Group could receive approximately $55.9 million if all outstanding warrants are exercised for cash.
• The exercise of warrants is dependent on the trading price of the ordinary shares, which is currently $9.56 per share, while the exercise price is $11.50 per share.
• The selling securityholders may offer these securities from time to time through public or private transactions at prevailing market prices or at privately negotiated prices.
• The ordinary shares being registered for resale represent approximately 91.7% of the total issued and outstanding ordinary shares on a fully diluted basis.
• The resale of a substantial number of shares may have a material negative impact on the market price of the ordinary shares.

Sentiment

Score: 6

Explanation: The document is generally neutral, focusing on the mechanics of the resale and the potential for future growth, but also highlighting the risks associated with the resale and the company's reliance on other sources of funding.

Positives

• The company has the potential to receive $55.9 million if all outstanding warrants are exercised for cash.
• The company is satisfying certain registration rights granted to securityholders.

Negatives

• The resale of a substantial number of shares may have a material negative impact on the market price of the ordinary shares.
• The company will not receive any proceeds from the sale of shares by the selling securityholders.
• The exercise of warrants is dependent on the trading price of the ordinary shares, which is currently below the exercise price.

Risks

• The resale of a substantial number of shares may have a material negative impact on the market price of the ordinary shares.
• The company may not receive any proceeds from the exercise of warrants if the trading price of the ordinary shares remains below the exercise price.
• The company does not expect to rely on the cash exercise of warrants to fund its operations.
• The company is a foreign private issuer and may elect to comply with certain reduced public company disclosure and reporting requirements.
• The company is a controlled company and may elect not to comply with certain corporate governance standards.

Future Outlook

The company intends to rely on other sources of cash to fund its operations and has identified several growth opportunities that may be pursued organically or through M&A or partnerships.

Management Comments

• The company believes its combination with Thunder Bridge will enable it to access international capital markets, which will help it to finance accelerated growth.
• The company believes it is well positioned to benefit from increasing adoption of cryptocurrencies and other new technologies within the worlds fourth largest economy.

Industry Context

The document highlights the company's position as a leader in the Japanese crypto exchange industry and its efforts to expand access to innovative digital products and solutions beyond cryptocurrencies.

Comparison to Industry Standards

• The document states that Coincheck estimates that 19.1% of cryptocurrency users in Japan have a verified Coincheck account, or approximately 2.1 million users as of September 30, 2024, based on data compiled by the JVCEA.
• The document also states that Coincheck had a 32.1% market share by trading volume as of September 2024, according to the JVCEA.
• The document notes that Coincheck supports trading in 30 different types of cryptocurrencies across all its Marketplace and Exchange platforms as of September 30, 2024, unchanged from June 30, 2024.
• The document mentions that Coincheck conducted Japans first IEO during 2021 and has launched a marketplace for NFTs.

Legal Proceedings

• The company was subject to lawsuits relating to the calculation of the compensation provided to customers who were adversely affected by a cybersecurity incident in January 2018.
• Some of these lawsuits have been resolved by judgment or alternative dispute resolutions but as of September 30, 2024 there is one remaining lawsuit demanding approximately 5 million.

Stakeholder Impact

• The resale of a substantial number of shares may have a material negative impact on the market price of the ordinary shares, potentially affecting shareholders.
• The company's ability to access international capital markets may benefit customers through increased innovation and opportunities to access the crypto economy.

Next Steps

• The selling securityholders will determine when and how they will dispose of any ordinary shares and warrants registered under this prospectus for resale.
• The company will continue to explore new financial service businesses and additional on-ramp services between fiat and crypto assets.

Key Dates

Keywords

Coincheck Group, ordinary shares, warrants, resale, registration statement, business combination, securityholders, public offering, private warrants, public warrants