As an important date for Twitter shareholders looms, the company’s top brass wants Wall Street to know one thing: They’re in it for the long haul.
As Lockup Date Looms, Twitter Says Its Big Shareholders Aren’t Selling Anytime Soon
Twitter shares have been drooping. Maybe this will perk them up.
Anthony Correia / Shutterstock
Dick Costolo, Evan Williams, Jack Dorsey and venture capital firm Benchmark said they “have no current plans to sell any of their shares of Twitter common stock,” according to a Monday morning filing with the Securities and Exchange Commission.
Rizvi Traverse Management, one of Twitter’s largest institutional investors, also has no plans to sell off the stock when the lockup hits, according to a person familiar with the firm’s thinking. The same is true for IVP, Insight Venture Partners and Kleiner Perkins, according to other people familiar with the matter.
And Lowercase Capital, another of Twitter’s institutional shareholders, won’t be selling as well. “We have no plans to sell or distribute our Twitter shares upon the lockup expiration,” Chris Sacca of Lowercase Capital told Re/code in a statement.
The timing isn’t coincidental. On May 5, Twitter’s first major share lockup expires, making eligible nearly 500 million shares of stock for the first time. That’s the most that will be potentially available for sale since the company went public in November of last year, when it sold upward of 70 million shares to raise as much as $2.1 billion.
It’s the first time that many Twitter insiders and long-time employees will be able to sell off their shares on the public market. That’s good for early employees whose stock has finally vested; it’s a chance to cash out and take some of their money off the table to do with as they want.
But it’s also something that has been making investors nervous. Facebook, which went public nearly two years ago, saw drops in the company’s stock price upon some (but not most) of its lockup expirations.
Twitter’s hope: Make clear that its top shareholders — as well as Twitter board members Benchmark Capital — won’t be selling any time soon, and it’ll instill confidence in everyone else.
The company has already lost nearly half its market value from its peak of $73.31, which it hit the day after Christmas last year — though the stock is still up from its IPO price of $26 per share. But tech stocks in general have taken a beating recently.
Shares are up 2.5 percent at $41.01 as of Monday morning trading.
This article originally appeared on Recode.net.
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