[Feature] Huobi's Acquisition Battle, Who Is the Winner?

On August 12, Li Lin, founder of Huobi Global, entered talks with a group of investors to sell 60% of his shares in Huobi at a valuation of $3 billion U.S. dollars.

According to insiders, Tron founder Justin Sun and FTX exchange had made preliminary contact with Huobi about the share transfer, and both requested anonymity in their private discussions. This was also reported by Bloomberg.

Shareholders, including ZhenFund and Sequoia China, learned of Li Lin's decision at a shareholder meeting in July, with one of them saying that this deal could close as soon as the end of this month. It is, however, unclear whether the acquisition would involve Hong Kong-listed Huobi Technology Holdings Ltd.

Shortly after, Justin Sun clarified that his team was not involved in any matters related to the story published by Bloomberg.

On August 13, Huobi mentioned that there were no plans to transfer ownership of the majority of their shares and that the company is operating as usual. FTX spokesman also declined to comment.

On August 29, there was a rumor that FTX officially acquired Huobi and will be renamed HTX in the future. Both FTX and Huobi responded that there were no further updates to share on this matter.

On September 21, Huobi Technology, a Hong Kong-listed company, issued a circular from the board of directors, suggesting that the company be renamed "New Huo Technology Holdings Limited".

On October 8, Huobi Global’s website issued an announcement stating that they have reached an agreement with About Capital to sell the entire shareholding in Huobi Global. About Capital will hence control the majority of shares in Huobi Global upon completion of the transaction. This transaction only involves changes in the control of shares and will not affect the existing core management and operation teams.

On the morning of October 10, according to official news, About Capital (now the biggest shareholder of Huobi Global), decided to set up a global advisory board comprising industry leaders across blockchain and traditional organizations. The initial list of Huobi Global advisors included Wang Yang (vice president of Hong Kong University of Science and Technology), Justin Sun (founder of TRON), and Leah Wald (co-founder of Valkyrie Investments).

With About Capital now controlling most of the shares in Huobi Global, Li Lin also announced the relinquishment of his own authority in the company.

On October 10, insiders said that the actual core investor of M&A fund under About Capital was in fact Justin Sun. He was also personally in Singapore for the sale of shares on October 8.

The purchase price is upwards of $1 billion U.S. dollars. Again, Justin Sun denied his involvement. However, Justin Sun's official social media revealed that he is now an advisor to Huobi Global. He also added Huobi's official website link to his Twitter profile.

At present, Justin Sun is observed to be vigorously recruiting. Concurrently, some departments in Huobi are also in the process of C Suite recruitment (the original C-headed executives have successively withdrawn their authority and proposed to resign). Huobi’s divisions in specific regions such as Huobi Japan and Huobi Korea are also currently coordinating new organizational and sales processes. Li Lin will still be responsible for the complete liquidation of domestic user assets.

Chen Yihua, a former member of About Capital, used to be a partner of Jinglin Assets, China’s top private equity firm. Hence there was some misunderstanding that Jinglin Assets was behind the acquisition of Huobi. However, they did not participate in this acquisition.

Instead, About Capital was used as a bridge for Justin Sun to acquire Huobi. Similarly, even though Sam Bankman-Fried (founder and CEO of FTX) stated that he had no plans to acquire Huobi, FTX was rumored to have provided funds to Justin since this acquisition allows them to compete more directly with Binance.

In addition, Justin Sun appeared at an afterparty organized by Huobi during TOKEN2049 in Singapore which was held recently. In the first half of the year, Justin Sun and FTX’s CFO also often communicated with each other on acquisition matters in Singapore.