Overstock.com Inc Chief Executive Officer Patrick Byrne on Friday hit out at shareholders who questioned the sale of a portion of his stake in the company after the online retailer's shares plunged on Wednesday following the disclosure of his move.
Shares of the company, which offers a range of lower-priced luxury goods, fell about 16% on Wednesday after a filing revealed that Byrne, Overstock's largest shareholder, had sold about 500,000 of his shares, or 9% of his stake. Byrne revealed on Friday that he had sold a total of about 900,000 of his shares, or 15.5%, which had created "an unanticipated stir" among the company's shareholders.
Byrne, in a letter to shareholders, said people who he had never heard of were demanding answers regarding the timing, reasoning and purpose of the sale. "Not once have I ever asked a shareholder for his reasons in any decision he made. Yet, given the consternation this has caused, I will give an answer, to preclude further recurrence of mass vapours," Byrne said.
Byrne said that he told shareholders a year ago that he would make "significant sales" of his shares to fund different projects, including blockchain investments and to supplement his nominal salary of $100,000 annually. "I do not intend to ever give such an explanation again. I owe shareholders staying within the law and not making decisions based on inside information," Byrne said.
Byrne had previously pledged about 1.9 million of his 5.8 million shares he owned prior to this week's sale as collateral for credit from banks. Overstock's shares, which are up 3% in morning trading on Friday, have fallen about 89% from its record high in January 2018, when the company was benefiting from its plan to launch a digital token and from the hype around cryptocurrencies.
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