Nasdaq-listed financial services platform Robinhood Markets Inc has lowered its bid for United Kingdom-based crypto fintech firm, Ziglu in light of the current realities in the digital currency ecosystem.
The interest in Ziglu was first revealed in April when the US-based brokerage app unveiled a $170 million bid to take up ownership of the startup.
Robinhood has changed its bid and is offering $72.5 million representing a £28.29 share price, an amount less than half its initial proposal. While this new bid will result in losses for some of Ziglu’s investors, Chief Executive Officer Mark Hipperson affirmed that the company’s board has already approved the new bid.
He explained that should Robinhood terminate the existing sales and purchase agreement (SPA), the company would be left in an “extremely challenging market, and undercapitalized for the period ahead.”
“The board has spent significant time in discussion with Robinhood’s CEO and executive team negotiating and improving the terms of their revised offer. Based on these discussions and other considerations, we believe the revised proposal…is the best and only reasonable path forward for the company,” Hipperson said.
Robinhood’s move to slash its offer to acquire Ziglu was influenced by the current market condition, which has revalued most companies by about 50 to 90%. With its initial failure to penetrate the United Kingdom about two years ago, Ziglu, drawing on the regulatory backing, customer base, and unique solutions, represent the best bet for Robinhood to expand its footprint into the UK.
It is unclear when the new deal will be finalized. However, the new bid submitted by Robinhood is evident the company is keen, according to CEO Vlad Tenev, to “work to leverage the best of both companies, exploring new ways to innovate and break down barriers for customers across the UK and Europe.”
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