Cake Group CEO offers to sell stake to former CTO in court hearing

U-Zyn Chua, the former CTO of Cake Group who asked the Singapore High Court in December 2023 to wind up the crypto company, is now considering buying it outright.

Under a potential deal announced at a court hearing in Singapore on Monday, Chua would buy out Cake Group co-founder and CEO Julian Hosp’s interest in the company. The judge overseeing the winding-up application adjourned the case for five weeks so that Chua could review the offer.

When contacted by Tech in Asia, Chua said he is considering the deal.

Former Cake Group CTO U-Zyn Chua with his lawyers after Monday’s hearing / Photo credit: Chua’s Instagram account

The terms of the deal were not disclosed. If Chua accepts the deal, it would likely end months of in-fighting between him and Hosp, which was sparked by a round of layoffs at Cake Group in November 2023.

At the time, Chua said that he was opposed to the layoffs, adding that Hosp had kept him out of the loop and unilaterally carried out the job cuts.

Chua, who is still a director at the company, filed the winding-up application last December. He stepped down from his role as CTO in January this year.

Hosp tweeted that his lawyers had filed a notice with the courts stating he would resist the winding-up application.

See also: Cake Group cuts staff by 30% amid rift between co-founders

In an email sent to employees last November, Hosp acknowledged that Cake Group grew operating costs too quickly and underestimated “both the longevity and extent of a broader slowdown in the crypto landscape.”

The group, which earns from transaction fees, rose to prominence in 2021 – its best year financially – and was considered one of the biggest crypto firms in Singapore. That year, the company’s revenue reached US$631 million and its operating income stood at US$203 million, according to its financial statements.

But Cake Group suffered with the rest of the crypto market in 2022 after the collapse of Terra Labs. Revenue for the year dwindled by over half to US$266 million while profit fell to US$23.5 million.

Hosp could not be reached for comment. He posted on X (formerly Twitter) acknowledging the adjournment but did not mention the offer to sell.