Popular trading platform Robinhood announced on Wednesday that it plans to buy back the estimated $600 million in HOOD shares owned by FTX’s co-founder Sam Bankman-Fried. The company also cancelled an estimated $500 million of stock-based compensation for its co-founders.
Vlad Tenev, CEO and Co-Founder of Robinhood Markets, said,
Co-founder Baiju Bhatt and I announced today that we cancelled nearly $500 million of our share-based compensation to ensure the company has as many resources as possible to deliver value to customers and shareholders.
Robinhood Board has Approved the Purchase of the Shares from Emergent
Jason Warnick, Chief Financial Officer of Robinhood Markets, explained that the company’s board had approved purchasing most of the shares owned by Sam Bankman-Fried through the entity in Antigua, Emergent Fidelity Technologies.
On the capital management front, our Board authorized us to pursue purchasing most or all of our shares that Emergent Fidelity Technologies bought in May 2022. The proposed share purchase underscores the confidence the Board of Directors and management team have in our business.
The board has authorized us to go and repurchase those and so we’re in discussions with the DOJ on that. Hard to tell exactly what the timeline is going to be.
The Purchase is Subject to Approval by the US Department of Justice
However, the purchase will be subject to the approval of the US Department of Justice, which currently holds the Robinhood shares confiscated from Emergent Technologies in early January as potential proceeds of crime.
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