Investors sold their shares in online discount retailer Overstock.com (OSTK) - Get Report on Thursday after former CEO Patrick Byrne revealed that he sold his entire stake in the company he founded, and will invest the proceeds in gold and cryptocurrencies.
In a blog post titled, "A Message to My Former Colleagues at Overstock," Byrne disclosed that he sold 4.7 million shares between Monday and Wednesday - approximately 10% of the company's outstanding shares - for about $100 million. A regulatory filing with the Securities and Exchange Commission confirmed the stock sale.
Byrne, who resigned as Overstock's CEO last month after comments about the "Deep State" and his involvement in a government espionage probe, pointed to a government conspiracy backing Overstock.com short-sellers as the reason for his decision to divest his stash of stock.
"The proximate cause ... came when we heard over the weekend that starting last Friday, the Deep State's pets at the SEC began leaking something to their clients JPMorgan, Morgan Stanley, and Goldman," Byrne said in the blog post.
"They leaked that they were going to Bazoomba [destroy] our digital dividend. Once that started getting back to me, I realized this: Whenever I have had any question about whether the SEC would or would not do something totally outrageous in order to hurt our company to benefit their clients on Wall Street, they never let me down: they always did the evil thing."
Up to mid-August, Overstock shares had rallied about 150% on optimism around higher-margin blockchain products and signs of a turnaround in its retail business. However, the stock tanked after Byrne claimed he was the source of a number of emails and text messages given to the FBI as part of an investigation into the 2016 election.
"We see this as a tremendous positive," D.A. Davidson analyst Tom Forte wrote in a research note on Thursday following the share-sale disclosure, adding that the company should benefit from further additional distance from Byrne.
Shares of Overstock.com were down as much as 7% in trading on Thursday. At last check, the stock was down 3.83%, or 62 cents a share, at $15.57.