Sonnet BioTherapeutics, previously known as a cancer drug developer, has announced a significant merger with Rorschach I LLC worth $888 million. This marks a new course for the company into integrating cryptocurrency into its financial strategy.
Merger and New Directions
According to a press release from July 14, Sonnet BioTherapeutics has agreed to merge with Rorschach I LLC, allowing the company to pivot to a crypto treasury strategy. The deal, expected to close later this year, will create Hyperliquid Strategies Inc. (HSI), which will hold 12.6 million HYPE tokens worth $583 million and $305 million in cash.
Structure and Management of Hyperliquid Strategies
Post-merger, Rorschach, backed by Atlas Merchant Capital and Paradigm, will control 98.8% of HSI, leaving existing Sonnet shareholders with only 1.2%. This shift in ownership structure is unusual for a Nasdaq-listed entity. Bob Diamond, former Barclays CEO, will chair the board of HSI.
Biotech Sector of Sonnet
Despite the merger, Sonnet's biotech arm will not disappear; it will function as a subsidiary of HSI. It will continue to work on the SON-1010 drug, while shareholders will receive Contingent Value Rights linking payouts to future milestones in biotechnology.
The merger of Sonnet BioTherapeutics with Rorschach I LLC marks a new era for the company, focusing on cryptocurrency while still maintaining its biotech segment.
