Trump Media and Tech Group (TMTG), a company majority owned by US President-elect Donald Trump, is in talks to acquire cryptocurrency trading platform Bakkt. The Financial Times reports that Bakkt (BKKT) is now valued at more than $150 million. The deal does not include the cryptocurrency custody business, which is expected to collapse.
Following the announcement, shares of Trump Media and Bakkt (BKKT) soared, with Trump Media shares up 16% to $32 and Bakkt shares up 162% to $29.
Bakkt’s financial situation
In early 2024, the cryptocurrency exchange said in a filing with the US Securities and Exchange Commission (SEC) that it may not be able to continue. Additionally, Bakkt is considering a possible acquisition and is seeking advice from financial experts. In June, reports said the cryptocurrency company was also considering splitting up its business.
The New York Stock Exchange had warned Bakkt that its common stock was at risk of being delisted after the board of directors changed its average price below the $1 per share floor set by the exchange for at least 30 consecutive business days. Bakkt was founded by Intercontinental Exchange, which is also the parent company of the New York Stock Exchange.
Kelly Loeffler, former CEO of Bakkt, is married to Jeffrey Sprecher, co-chair of the Trump Inaugural Committee and CEO of Intercontinental Exchange.However, she stepped down as Bakkt’s CEO in 2019 after Georgia Governor Brian Kemp appointed her to the U.S. Senate following Senator Johnny Isakson’s resignation for health reasons.
After current CEO Andy Main took over, he announced that the company was “on mitigated terms” with the proceeds from a capital increase, cost-cutting plans and other related cost reductions, raising concerns about Bakkt’s future.
In its third-quarter 2024 report, Bakkt reported total revenue of $328.4 million, including an operating loss of $27.4 million, although this represented an improvement over the prior year.
TMTG’s market value has risen and fallen by billions of dollars in the run-up to this year’s presidential election. The company reported a net loss of $363 million and revenue of $2.6 million this year, but its market value is still over $7 billion.
TMTG still has just under $673 million in cash and cash equivalents, according to its latest annual report for the quarter.
