Sumner Group Holdings, a Middle East-focused investment company, is looking to raise up to $100 million (Dh367m) through a security token offering (STO) ahead of a planned listing on the London Stock Exchange next year.
The Dubai Multi Commodities Centre-based company is raising funding through its Singapore-registered subsidiary, Sumner Global, which will sell the SGHX token to public and private investors, the company said in a statement on Wednesday.
It plans to use the proceeds from the offering to support its global business and make an acquisition in the UAE, SGH said, without giving the details of the target company or size of investment.
STOs are financial securities backed by tangibles such as assets, profits, or revenue of a company, and offer legal rights such as voting or revenue distribution to the token holders. They are unlike initial coin offerings, which are not backed by assets.
“STO are a far cry from the days of ICO’s. Investors in the SGHX STO will receive tokens that are digitally programmed, and asset-backed through a combination of public and private companies,” said David Sumner, chief executive of SGH. “Prior to any public sale launch, the tokens will be verified as fully compliant with regulations enforced by the Monetary Authority of Singapore."
Abu Dhabi investors Blue Rock Capital and Blue Stone Capital have agreed to become cornerstone investors, and intend to contribute $10m each to the STO. The remaining $80m will be raised through private sales and subsequent listing of SGHX tokens on a suitable exchange, the company said.