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Trump Media plummets 18% after taking first step toward early insider stock sales

Former President Donald TrumpScott Eisen/Getty Images

  • Trump Media fell as much as 18% after a new filing showed it was registering shares.

  • This move could potentially allow insider shareholders to offload their shares before the end of the six-month lock-up period.

  • Due to the slump in shares, the value of Donald Trump’s share has fallen to $2.2 billion.

Trump Media opened the week with a sharp decline on Monday, as the company took action to allow company insiders to sell their shares earlier than allowed.

The social media startup fell as much as 18% to an intraday low of $26.83, continuing the sudden slump that began on March 27. Since then, the company is down almost 56%.

Monday’s downward momentum came after news that the company had filed to register shares with the Securities and Exchange Commission. While this doesn’t mean a sale is about to happen, it is the first step for insiders to be able to sell their shares. They are currently not allowed to sell anymore until September.

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Former President Donald Trump is the majority shareholder in the company and could unlock billions in windfalls if he manages to cash out his shares. He founded the company to launch Truth Social, a media platform created following his 2021 ban from sites like Twitter and Facebook.

Last month, the company was elevated to meme stock status after going public in a blank-check deal, with Trump supporters diving into the market and sending shares to a peak of $66.4.

But the stock has since gone into freefall after Trump Media reported net losses of $58 million in 2023. With stocks falling, Trump’s stake is now valued at $2.3 billion, a figure that was more than $5 billion just weeks before, according to Bloomberg. reported.

In Monday’s S-1 filing, the company registered more than 146 million shares of common stock, of which Trump owns 114.8 million, according to CNBC. 4 million warrants were also registered, referring to stock-related contracts redeemable for cash.

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In addition, more than 21 million common shares have been issued upon exercise of warrants. The company expects to receive approximately $247.1 million from the exercise of these securities.

Read the original article on Business Insider

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