Zynga founder, other insiders to sell 43M shares

March 23, 2012

(AP) -- Zynga's CEO and other insiders at the online games company plan to sell 43 million shares of stock in a public offering that will boost the amount of stock available for general trading by 35 percent.

Class B stock owned by Mark Pincus and others will be converted to regular, Class A shares. All shares have the same ownership value, but Class B stock has seven times the voting power.

Pincus, who founded Zynga Inc. in 2007, will control about 35 percent of the company once the offering is complete. That's down only slightly from 36.5 percent because he will retain his Class C shares, which have 70 times the voting power of Class A stock.

Zynga, which had its of stock in December, disclosed the latest plans in a regulatory filing Friday and said proceeds from the sale will go to the individuals, not the company.

Zynga is the maker of online games such as "CityVille," "FarmVille and "Zynga Poker." Many of the games are played on , though Zynga has been working on expanding to other areas, notably mobile devices. "Words With Friends," a Scrabble-like game played mainly on smartphones, is one of its best-known titles.

It was one in a group of companies that went public over the past year. Others include Corp., Groupon Inc. and Inc. Facebook is expected to have its IPO this spring.

The move announced Friday was expected. Last week, the company said Zynga shareholders may sell some shares, just three months after the company went public, to try to avoid a drop in its stock price. The number of shares wasn't disclosed at the time.

Early investors typically must wait about six months after an IPO to sell off parts of their stakes. By selling some shares now, shareholders won't be flooding the market all at once in June when the post-IPO "lock-up" is scheduled to expire. A mass wave of selling can drive down the .

Zynga's stock fell 36 cents, or 2.6 percent, to close Friday at $13.40. At that price, the 43 million shares will be worth about $576 million. Pincus is offering 16.5 million shares, worth about $221 million. The stock has increased 34 percent since its IPO price of $10.

Zynga also disclosed that it had spent $180 million to buy OMGPop, maker of the popular mobile game "Draw Something." The company didn't disclose the price when it announced the deal on Wednesday.

Explore further: Zynga adding more ways to play games as IPO looms

0 shares

Related Stories

Report: Zynga CEO wants workers to give back stock

November 10, 2011

(AP) -- Zynga CEO Mark Pincus wants some of the online game company's early employees to give back stock they own ahead of the company's initial public offering of stock, according to a published report Thursday.

Zynga plans to raise up to $1.15B in IPO

December 2, 2011

(AP) -- Online game maker Zynga says it plans to raise up to $1.15 billion in an initial public offering of 115 million shares in the latest in a spate of Internet IPOs

Zynga posts 4Q net loss on IPO-related stock costs

February 14, 2012

(AP) -- Online game maker Zynga Inc. reported a net loss in the last three months of 2011, weighed by hefty stock-compensation expenses and other costs in its first quarter as a public company.

Zynga holders plan to sell up to $400M in stock

March 14, 2012

Zynga shareholders may sell up to $400 million of stock through a public offering, three months after the online game maker went public, to try to avoid a drop in its stock price.

Recommended for you

Netherlands bank customers can get vocal on payments

August 1, 2015

Are some people fed up with remembering and using passwords and PINs to make it though the day? Those who have had enough would prefer to do without them. For mobile tasks that involve banking, though, it is obvious that ...

Power grid forecasting tool reduces costly errors

July 30, 2015

Accurately forecasting future electricity needs is tricky, with sudden weather changes and other variables impacting projections minute by minute. Errors can have grave repercussions, from blackouts to high market costs. ...

Microsoft describes hard-to-mimic authentication gesture

August 1, 2015

Photos. Messages. Bank account codes. And so much more—sit on a person's mobile device, and the question is, how to secure them without having to depend on lengthy password codes of letters and numbers. Vendors promoting ...

0 comments

Please sign in to add a comment. Registration is free, and takes less than a minute. Read more

Click here to reset your password.
Sign in to get notified via email when new comments are made.