Hong Kong-listed DL Holdings plans $83 million raise to fund blockchain initiatives

DL Holdings, a Hong Kong-listed financial services group, saw its stock fall more than 8% on Thursday after announcing plans to raise HK$653.3 million ($83.2 million) through share placements to fund its blockchain initiatives.

The company disclosed in a filing with the Hong Kong Stock Exchange that it has entered into a placing and subscription agreement where selling shareholders will sell shares to at least six buyers at HK$2.95 per share through placing agents, then immediately repurchase the same number of new shares from the company at the identical price. 

The shares being placed represent approximately 13.58% of the company's current issued share capital, which will decrease to about 11.96% after the new shares are issued to complete the transaction.

DL Holdings said it plans to allocate the proceeds primarily toward blockchain and crypto asset initiatives, including real-world asset tokenization and strategic investment (30%), bitcoin mining operations and reserves (15%), digital assets and stablecoin business development (8%), crypto asset trading licenses in Hong Kong (7%), with the remaining funds supporting IT infrastructure, ETF development, U.S. real estate investment, and working capital.

Following the company's announcement, its stock fell 8.4% to HK$3.07 at the time of writing on Thursday, according to Yahoo Finance data, with the market still open.