[NEWS] Ripple to buy back approximately 41.5 billion yen of its own shares

It has been revealed that Ripple is planning to buy back $285 million of its own shares from early investors and employees. Reuters reported on the 11th.

The buyback will value the company at $11.3 billion. According to an anonymous source who spoke to Reuters, investors can only sell up to 6% of their shares.

Ripple is a private company, but it seems to be planning to spend a total of $500 million on share buybacks to cover the costs and taxes of granting a tender offer and converting restricted stock units into shares.

A Ripple spokesperson told Reuters, "We are using $500 million of cash from our balance sheet to convert restricted stock units and buy back shares, purchasing up to $285 million worth of shares and spending more than $200 million on restricted stock unit conversions. Our equity valuation will exceed $11.3 billion."

Ripple CEO Brad Garlinghouse said, "Ripple currently has over $1 billion in cash and over $25 billion in crypto assets on its balance sheet," and said the company will buy back shares to provide liquidity to investors.

Ripple also said it has no plans to go public at this time, citing regulatory uncertainty.

Ripple's lawsuit

The buyback comes after Ripple won a partial victory in a lawsuit against the SEC last July, which ruled that sales of XRP to retail investors are not unregistered securities. On the other hand, the lawsuit also found that sales of XRP to institutional investors violated securities laws.

The SEC sought an interlocutory appeal at the end of last year, but the court denied the request. In addition, the SEC dropped all charges against Garlinghouse and former Ripple executive Christian Lassen in October last year. The two had been charged with aiding and abetting securities law violations in relation to the sale of XRP, but all charges were dismissed.

The next settlement motion briefing is scheduled for February 12th in the trial over the illegality of XRP sold to institutional investors. If the trial drags on, the ruling could be made around summer.

Reference:Reuters
Image: Shutterstock

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