Intercontinental Exchange Inc. (ICE), the owner of the New York Stock Exchange has recently sold its 1.4% stake in the newly listed Coinbase in order to reduce the debt of the company. The owner of Bakkt digital asset platform has reportedly sold a stake worth $1.2 billion in the newly listed cryptocurrency firm Coinbase.
Intercontinental Exchange Inc. (ICE) Sells Coinbase
In accordance with the announcement made on Thursday on a financial-results call for the very first quarter of the year 2021 by the Chief Financial Officer of ICE, Scott Hill, the company sold its Coinbase stake for a whopping $1.2 billion.
In addition to this, the executive of the firm also noted that the sale generated around $900 million net after clearing taxes.
Hill said that the proceeds were used to minimize the debt of ICE at the end of the first quarter.
Moreover, he noted that the pro forma leverage of the firm, or total indebtedness rate, would have been closer to 3.6x compared to 4.2x when ICE acquired software company focused on the mortgage, Ellie Mae in September 2020.
Warren Gardiner, the Chief Financial Officer of ICE said:
“We are definitely a bit ahead of schedule, having paid down debt faster than we sort of expected when we started the deal. I mean I would say we were doing that, though, before the Coinbase sale.”
Proceeds From Selling Exchange Provided Flexibility
Gardiner stressed the fact that the proceeds from the Coinbase exchange provided the firm with some additional flexibility as ICE moved forward into the rest of the year. He said:
“We are down to about 3.6 leverage, the target is about 3.25, where we can start to think about buying back stock.”
The decision of ICE to sell the shares of Coinbase comes amid the firm posting record revenues in the first quarter of the year 2021 totaling $1.8 billion and up 4% year-over-year.
“First quarter revenues, operating income, adjusted net income, and adjusted earnings per share were all the best in the history of our company.”