Stock and cryptocurrency platform Robinhood Markets HOOD saw shares surge Monday as it was reported the company could soon be acquired. Here’s the latest.
What Happened: Robinhood shares surged Monday on a report by Bloomberg that FTX could be looking to acquire the company that cited people familiar with knowledge of the matter.
Related Link: Report Of FTX's Interest In Robinhood Comes 1 Week After This Acquisition
FTX Responds: The rumors of an acquisition likely made sense to investors, as it was disclosed last month that FTX CEO and co-founder Sam Bankman-Fried took a stake in Robinhood.
Bankman-Fried owns 7.6% of Robinhood.
“The reporting persons acquired the shares in the belief that the shares represent an attractive investment. The reporting persons intend to hold the shares as an investment, and do not currently have any intention of taking any action toward changing or influencing the control of the issuer,” the filing read.
While Bankman-Fried owns a stake in Robinhood, he said Monday that FTX is remaining on the sidelines.
“We are excited about Robinhood’s business prospects and potential ways we could partner with them, and I have always been impressed by the business that Vlad and his team have built,” Bankman-Fried said in a statement to TechCrunch. “That being said there are no active M&A conversations with Robinhood.”
Bankman-Fried said FTX is open to partnering with Robinhood in the future.
A Robinhood spokesperson told TechCrunch no buyout can occur without the approval of Robinhood’s founders due to a dual-class shareholder setup.
FTX recently announced it has $2 billion to spend on acquisitions and taking stakes in other companies.
HOOD Price Action: Robinhood shares spiked late Monday on rumors of a buyout by FTX and were temporarily halted.
Robinhood shares are now down 5% to $8.71 in after-hours trading. Robinhood shares have traded between $6.81 and $85 over the last 52 weeks.
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