In April, Zynga conducted a "secondary stock offering" in which insiders dumped 43 million shares of stock at $12 a share, raking in about $516 million.
Yesterday, four months later, Zynga reported a horrible quarter, and the stock plunged to $3.
In other words, Zynga insiders cashed out at exactly the right time.
In fact, they cashed out in the same quarter in which Zynga imploded.
The quarter had already begun when Zynga insiders shoveled their stock out the door.
By the time the quarter ended, Zynga's business (and stock price) was in the tank.
Zynga's April stock offering was managed by Morgan Stanley, Goldman Sachs, Bank of America, and other premiere Wall Street underwriters. All of the stock sold in the offering was sold by Zynga insiders. None of the cash raised in the offering went to the company.
The Zynga underwriters were paid ~$15 million of fees to arrange this cash-out.
Zynga, the company, also paid $1 million in expenses to facilitate the cash-out (legal fees, privateRead More »from Zynga Insiders Who Cashed Out Before The Stock Crashed