Intercontinental Exchange sells Coinbase stake for $ 1.2 billion


Intercontinental Exchange, the operator of the New York Stock Exchange and owner of digital asset platform Bakkt, has sold its 1.4% stake in newly NASdaq-listed cryptocurrency company Coinbase.

Announcing the news Thursday of a first quarter 2021 financial results call, ICE Chief Financial Officer Scott Hill said the company has sold its share of Coinbase for $ 1.2 billion. The executive noted that the sale brought in approximately $ 900 million net after tax.

Hill said the proceeds were used to reduce ICE’s debt at the end of the first quarter. He noted that the company’s pro forma leverage, or total debt ratio, would have been closer to 3.6x compared to 4.2x when ICE acquired mortgage-focused software firm Ellie Mae in September 2020.

“We are definitely a bit ahead of schedule, paying off debts faster than we expected when we started the deal. I mean, I would say we did that before the Coinbase sale, ”added Warren Gardiner, ICE’s new CFO. He stressed that Coinbase’s proceeds gave the company “some extra flexibility” as ICE moves into the rest of the year. “We’re at about 3.6 leverage, the target is about 3.25, where we can start thinking about buying back shares,” he noted.

ICE’s decision to sell Coinbase stock comes amid the company posting record revenues in Q1 2021 totaling $ 1.8 billion and up 4% year-on-year. “First quarter earnings, operating income, adjusted net income and adjusted earnings per share were the best in our company’s history,” said the CFO. He stated that while ICE’s total transaction revenues were slightly down from last year, the amount of total recurring revenues is up 9%.

As previously reported, ICE’s digital asset trading platform, Bakkt, will be made public on NYSE in the second quarter of 2021 through a merger with VPC Impact Acquisition Holdings.

Coinbase, the largest crypto exchange in the United States, took to the Nasdaq on April 14 with a direct listing of its COIN shares. The shares opened at $ 381, which meant increased institutional demand as the stock’s reference price before listing was only $ 250. The Coinbase stock closed at $ 294 on Thursday, after a gradual decline post-listing, according to data from TradingView.

COIN share all-time price chart. Source: TradingView

As previously reported by Cointelegraph, multiple COIN investors, including Coinbase executives, sold $ 5 billion worth of COIN shares shortly after the listing. Notable sales included those of Coinbase CEO Brian Armstrong, who sold nearly 750,000 shares for a total of approximately $ 292 million.