Bankman-Frieds FTX says no talks about buying Robinhood

The logo of Robinhood Markets, Inc. was seen at a pop-up event on Wall Street after the company’s listing in New York City, USA, July 29, 2021. REUTERS / Andrew Kelly

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June 27 (Reuters) – Sam Bankman-Peace’s FTX cryptocurrency exchange said it was not in talks to buy Robinhood Markets Inc (HOOD.O), after a report on Monday claimed that the exchange was examining such an agreement.

Bloomberg News reported on Monday that FTX was discussing internally how to buy the app-based brokerage house, and that Robinhood had not received a formal takeover approach, referring to people with knowledge of the case.

“There are no active M&A talks with Robinhood,” Bankman-Fried said in an email. “We are excited about Robinhood’s business prospects and possible ways we can work with them.”

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Robinhood declined to comment. The retail trading platform’s shares fell 5% in expanded trading after skipping 14% on the report.

Last month, the founder and CEO of FTX revealed a 7.6% stake in Robinhood, but said he had no intention of taking control of the retail platform.

Robinhood’s dual class shares give founders control over 64% of the voting shares, making it virtually impossible to acquire without their support. read more

The popular trading platform has come under pressure this year as trading volumes decline from 2021’s frantic pace – as retail investors used it to pump money into shares of so-called meme stocks such as GameStop (GME.N) and AMC Entertainment (AMC.N).

This decline, together with a sale of high-growth technology stocks, has led to a decline of almost 50% in Robinhood shares this year. The company had a market value of almost $ 7 billion at Friday’s closing price.

FTX’s US arm announced in May that it would launch a stock trading platform by the end of the summer. Last week, it acquired partner Embedded Financial Technologies for an undisclosed amount, which would add custody, execution and clearing services to its stock trading platform.

FTX and billionaire founder Bankman-Fried have rescued other players during the recent cryptocurrency market crash. It gave cryptocurrency lender BlockFi a $ 250 million revolving credit facility to help the company avoid a liquidity crisis.

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Reporting by Manya Saini in Bengaluru, John McCrank and Krystal Hu in New York; Edited by Aditya Soni and Richard Chang

Our standards: Thomson Reuters Trust Principles.

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