Robinhood Announces Plan To Repurchase Shares

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Robinhood Announces Plan To Repurchase Shares

Robinhood Announces Plan To Repurchase $605 Million Stake From Bankman-Fried

In a recent announcement made on Friday, Robinhood said it would be repurchasing its shares that the Bankman-Fried owned.

The Robinhood's agreement is made with the USMS (United States Marshal Service), which will allow the trading platform firm to spend around $605.7 million for repurchasing the stake owned by the Bankman.

After all the trouble faced by the FTX and the Bankman-Fried, the Robinhood shares owned by them were seized and then transferred to the US government custody. This occurred after the FTX and other related firms went bankrupt and couldn't complete their liabilities.

Robinhood Shares Up By 3%

After the news, the shares of Robinhood gained a 3% upside during the premarket trading hours, which suggests that investors are taking this report positively.

As per the details, each share of Robinhood will be valued at $10.96, and the company wants to buy back 55.3 mn shares. The sale of these shares has already been approved by the relevant US authorities and the US district court.

Robinhood initially expressed its intentions to repurchase the shares in February but had to wait until it got authorization from the management board.

And if we look back, FTX announced that it now owned a 7.6% stake in Robinhood. This announcement was made around 6 months before the whole FTX saga and the bankruptcy that ensued.

At that time, Bankman-Fried made it clear that they had no intentions of taking over the Robinhood control. However, he added that he was excited about how it would allow them to find new ways to partner with Robhinhood.

The Bitcoin boom allowed the Bankman-Fried and countless others to build billions of dollars worth of assets. In the case of Bankman-Fried, he had a $26 billion net worth at one time and even became a major donor to US political parties.

Once this Robinhood deal is done, it means the shares will move out of the US authority's custody and will go back to Robinhood.

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