Robinhood’s board has approved a plan to acquire Sam Bankman-Fried’s seven percent stake in the stock trading app.
In May, it was revealed that Emergent Fidelity Technologies, where Bankman-Fried is the sole director, had purchased a 7.6% stake in Robinhood, valued at approximately $580 million. During the company’s fourth-quarter earnings report, CFO Jason Warnick mentioned to CNBC that the board has authorized discussions for repurchasing the stake and that they are currently in talks with the DOJ, although the timeline remains uncertain.
Bankman-Fried is currently facing eight criminal charges connected to the collapse of FTX, the cryptocurrency exchange he founded, and he has pleaded not guilty.
Following this announcement, Robinhood’s shares rose by over five percent in after-hours trading on Wednesday. However, the company reported a fourth-quarter loss of $166 million on revenues of $380 million, which was partially attributed to a “processing error” that cost several million dollars and caused executives to forfeit cash bonuses.