- The offering is through an automatic conversion of certain convertible notes.
- The stockholders were among those who came to Robinbood’s rescue during the historic trading mania earlier this year.
- The selling shareholders include a number of venture capital firms that invested in Robinhood early on.
Robinhood said Thursday that existing shareholders will sell up 97.9 million shares over time. The news knocked shares of the trading app that have surged this week.
In a filing, the commission-free broker said it will not receive any of the proceeds from the stock sale of 97,876,033 shares of its Class A common stock. The offering is through an automatic conversion of certain convertible notes held by the selling stockholders in connection with last week’s initial public offering.
The stockholders were among those who came to Robinbood’s rescue during the historic trading mania earlier this year. Faced with unprecedented volatility and increased deposit requirements, the broker was forced to tap credit lines and raised new debt to ensure it had enough cash to clear trades. It also briefly restricted trading in a number of short-squeeze names.