As an analyst with over two decades of experience in the tech and finance industries, I’ve seen my fair share of mergers and acquisitions, some successful, some not so much. However, the potential acquisition of Bakkt by Trump Media and Technology Group (TMTG) is a unique proposition that catches my attention.
Reports indicate that Donald Trump’s media company, Trump Media and Technology Group (TMTG), is deep in discussions for the potential purchase of Bakkt, a digital asset trading platform controlled by the Intercontinental Exchange (ICE).
Trump Sets Sights On Crypto Expansion
Based on reports from individuals privy to the talks, it appears that TMTG might be contemplating a takeover of Bakkt using only shares, though the specific price tag is yet to be determined. At present, Bakkt’s total value, as of Monday, hovers around $150 million.
Since Trump’s election victory on November 5, there has been significant focus on TMTG, a company he has vowed to retain a 53% ownership stake in. Even though this year’s revenues were reported at $2.6 million, TMTG boasts an impressive equity valuation of $6 billion, giving it strong financial resources for potential future acquisitions.
After the news broke about possible takeover discussions, Bakkt’s shares skyrocketed by 86%, showing investor enthusiasm about a potential acquisition. Similarly, TMTG’s stock price experienced a substantial increase of approximately 14% as well.
TMTG Explores All-Share Purchase Of Bakkt
Established by ICE, Bakkt originally served as a platform offering diverse cryptocurrency services, such as a custodial service specialized in safeguarding prominent digital currencies like Bitcoin (BTC) and Ethereum (ETH) for its customers.
Despite generating modest revenue of $328,000 during the third quarter, Bakkt’s crypto business has experienced significant financial setbacks, recording an operating loss of $27,000. As a result, it appears that TMTG may not incorporate Bakkt’s custody operations in its acquisition, which are anticipated to be discontinued instead.
Compared to Elon Musk’s X platform, Trump’s Truth Social sees significantly fewer daily visitors, with an average of about 646,000, whereas Musk’s platform gets roughly 155 million.
As a crypto investor, I can’t help but notice the substantial investment made by the President-elect in TMTG, which accounts for over half of his reported $5.7 billion net worth, as per Bloomberg. This significant stake certainly piques my interest and makes me curious about its potential impact on both the market and the broader economy.
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2024-11-19 00:58