XRP Treasury SPAC Shares Halve Before Evernorth Debut

Armada Acquisition Corp. II shares fell 50.3% to $19.20 on Tuesday, reversing a sharp rally before the company’s planned merger with Evernorth. The shares trade under the XRPN ticker.

In an Oct. 6 filing, Evernorth reported that an administrative delay had moved the expected merger closing to around Oct. 9 from Oct. 7. Trading of the combined company on Nasdaq is expected to begin around Oct. 12, instead of Oct. 8. Evernorth does not expect the delay to affect the closing.

XRPN closed at $23.43 on Oct. 1, reached $53 on Oct. 2 and ended that session at $39.42. The stock closed at $38.65 on Oct. 5 before falling to $19.20 the next day. Despite the decline, it remained about 81% above its Sept. 28 close of $10.58.

The rally accelerated after Armada shareholders approved the Evernorth transaction on Sept. 30. The number of Armada shares available for trading may have contributed to the price swings.

Armada reported 23 million shares subject to redemption as of June 30, backed by $241.2 million in its trust account, or about $10.49 per share. Evernorth later reported that about $48 million from the trust is expected to remain for the combined company after the transaction closes.

Using Armada’s June trust value as an estimate, $48 million would represent about 4.6 million of the 23 million redeemable shares. That implies redemptions of close to 80%, although the companies have not disclosed the final figure. Redemptions can reduce the number of shares available for trading in a special purpose acquisition company.

The merger is expected to create what Evernorth describes as the largest publicly traded company focused primarily on an XRP treasury. Evernorth expects to hold about 473 million XRP at closing and receive roughly $300 million in gross cash proceeds.

The expected proceeds include $225 million from private placements, $30 million from convertible-note financing and about $48 million from Armada’s trust account before transaction expenses. Ripple, SBI Group, Arrington Capital, Pantera Capital, Kraken and GSR are among the investors backing the transaction.

Chief Executive Asheesh Birla has outlined plans to invest across the XRP ecosystem and increase the amount of XRP held per share over time. After closing, the companies are expected to disclose the final redemption count, cash delivered from the trust account and the combined company’s share structure. Armada’s outstanding warrants may provide an additional source of shares.