Sonnet BioTherapeutics' $88M Merger to Form Hyperliquid Strategies Inc., Focus on Crypto Management

Sonnet BioTherapeutics is merging with Rorschach I LLC in an $88 million deal, forming Hyperliquid Strategies Inc. The merged company will focus on cryptocurrency management with a reserve of 12.6 million HYPE tokens. Sonnet's stock surged over 320% in pre-market trading following the announcement. Wall Street analysts forecast a one-year price target of $20.00, suggesting a potential upside of 286.85% from its current trading price.

Sonnet BioTherapeutics, Inc. (NASDAQ: SONN) has entered into a definitive agreement to merge with Rorschach I LLC, creating Hyperliquid Strategies Inc. (HSI) with an anticipated closing value of $888 million. The new entity will focus on cryptocurrency management, particularly the HYPE token from the Hyperliquid Layer-1 blockchain.

The merger will result in HSI holding approximately 12.6 million HYPE tokens, valued at $583 million, and at least $305 million in cash. Key leadership positions will be filled by executives from Atlas Merchant Capital, with Bob Diamond serving as Chairman and David Schamis as Chief Executive Officer. The merger is subject to Sonnet stockholder approval and is expected to close in the second half of 2025.

Sonnet plans to raise $5.5 million through a private placement to support its corporate and operational objectives. The funds will be used for general corporate purposes and operational costs, including the development of biotech assets. Following the merger, Sonnet will operate as a wholly owned subsidiary of HSI and continue its biotech asset development.

The merger has been positively received by Wall Street analysts, with a one-year price target of $20.00 forecasted for Sonnet's stock, suggesting a potential upside of 286.85% from its current trading price. The announcement has led to a surge in Sonnet's stock, with a pre-market increase of over 320%.

References:
[1] https://www.nasdaq.com/articles/sonnet-biotherapeutics-announces-business-combination-rorschach-create-hyperliquid