After GoPro Inc (NASDAQ:GPRO) founders donated 5.8 million shares to start a charitable foundation, the stock slumped a whole 6.9% to close at $85.46 in New York. Nicholas Woodman, who is one of the company’s founders, evaded a post IPO lock-up selling restriction by donating the shares to Jill & Nicholas Woodman Foundation, a new foundation run by him and his wife.
The donated shares are worth $497.5 million based on the current market price. The move got the nod of JPMorgan Chase & Co., the lead banker that oversaw the company’s June 2014 IPO. The shares account for more than 28% of the company’s shares sold during the IPO and is a strategic move to meet the company execs’ promise not to flood the market with too many of the company’s shares.
The lock-up agreement dictates that GoPro Inc (NASDAQ:GPRO) shareholders who had shares before the IPO aren’t allowed to sell until after December 2014. That means the shares could only be available for sale in January 2015.
Woodman, who is founder and CEO, didn’t give details of the foundation and what it would like to achieve, but instead said that more details will be revealed later.
“We wake up every morning grateful for the opportunities life has given us. We hope to return the favor as best we can,”
Woodman and Jill said in a joint statement.
Sources that spoke with CNBC intimated that none of Woodman’s stocks were sold as part of the move.
GoPro Inc (NASDAQ:GPRO) stock has been a hot cake in the market since its IPO. The stock has managed to trade above $90, which is more than three times its IPO price of $24 a share. The lows brought about by the move to donate shares even took the stock to points below $90.
The spokespersons of both GoPro Inc (NASDAQ:GPRO) and JPMorgan Chase & Co. declined to comment on the move.
The San Mateo, California-based company has been performing well in the sale of its powerful, small, and wearable cameras that target extreme sports and adventure personalities. The good performance of the company’s products provides the impetus for the rise in the value of the stock.
HERO 4, the company’s latest camera is set for launch mid-October and is expected to boost the company’s end year sales. The launch will encompass two high end cameras and a $129 starter camera.