LONDON – Freetrade, the British rival of popular stock trading app Robinhood, said on Thursday it has been acquired by online investing platform IG Group.

The deal values ​​Freetrade at £160 million ($195 million) – 29% below its valuation final valuation. The startup said it will continue to operate as an independent commercial entity under its own brand.

Founded in 2016, Freetrade has gained popularity among the UK’s predominantly young, inexperienced traders with its zero-commission trading platform.

The app initially offered stocks but has since expanded to launch trading in exchange-traded funds, savings products and government bonds.

During the pandemic, free trade thrived amid a frenzy among retail traders. The app benefited greatly from the GameStop “short squeeze” in early 2021, when traders on Reddit forums for retail investors piled into the stock, causing its price to rise.

Short selling is when an investor borrows an asset and then sells it on the open market with the expectation that the asset will be repurchased for less money in the future at a profit.

However, deteriorating macroeconomic conditions in 2022 and 2023 hit COVID-19 businesses like Freetrade hard – and in 2023, Freetrade completed Crowdfunding at Valuation 225 million pounds, down 65% from the previous 650 million pounds.

The deal is a potential signal of further consolidation in the wealth technology industry. it appears after Hargreaves Landown was Acquired by a consortium of investors for £5.4bn Among them is private equity giant CVC Group.

Freetrade CEO and co-founder Viktor Nebehaj described the acquisition as “a transformative transaction that recognizes the tremendous value Freetrade creates”.

He added: “Coupled with IG Group’s significant resources and support, this is an exciting opportunity to accelerate our growth and delivery of new products and features.”

Freetrade said the deal is subject to customary closing conditions including regulatory approvals, adding that it expected to close the deal later this year.