Just before Zynga saw its stock collapse two days ago, the firm’s top executives, including its founder, dumped 43 million shares, cashing in pretty big as others who had no knowledge of the company’s poor financial state watch their investments go down the drain.
The stock’s now hovering between $2.99 and $3.17 per share, but before anyone knew of the firm’s dismal outlook, Zynga founder sold a huge amount of shares totaling $516 million at $12 per share.
This occurred back in April, which as Yahoo notes is in the same financial quarter that the company’s poor earnings caused its stock to fall. Back then, Zynga held a “secondary stock offering.” Said offering included stocks owned solely by Zynga executives and properly-connected investment firms. Combined, they sold 43 million shares at $12 a share, shares now trading just over $3.
At that time Marc Pincus sold 16.5 million shares equating to over $200 million, Zynga CFO David Wehner sold 386,000 for $4.6 million, and former EA and Microsoft executive and sitting Zynga COO John Schappert sold 322,000 shares for $3.9 million.
At the moment, there’s no evidence of wrongdoing, but it sure seems fishy that top company executives would let loose tens of millions of shares just before the company lost most of its value.