GoPro Slips After Announcing Stock Offering to Allow Employees 'More Orderly' Exit

NEW YORK (TheStreet) -- Shares of action camera maker GoPro (GPRO) are slipping in early trading after the company filed to sell shares in a secondary offering of stock and its CEO acknowledged he plans to sell some of his stake as part of the offering. In a note to employees, however, the executive added that he intends to be a "significant shareholder in GoPro for a long time."

WHAT'S NEW: GoPro filed to sell $800M in common stock for shareholders. JPMorgan, Barclays, Morgan Stanley and Citigroup are acting as lead book running mangers for the stock offering. The company disclosed in a regulatory filing that Nicholas Woodman, GoPro’s Chief Executive Officer, sent an email message to company employees related to the offering, in which he wrote that such a "follow-on and secondary" offering is a "relatively common occurrence following an IPO" that allows a company to raise additional capital while providing early investors and employees with vested options the opportunity to realize a return on their "hard work and dedication." Woodman said the company expects to raise approximately $100M of new capital for the company via the offering, which will provide additional resources to "invest in people, products, potential acquisitions, and infrastructure to help us achieve our long-term vision." Woodman also said the offering is meant to facilitate a "more orderly and gradual sale of shares than what might otherwise occur when the IPO lock-up ends on December 22," adding larger shareholders that participate in this offering will be signing a new 90-day lock-up agreement that to help further this goal. Woodman acknowledged he plans to sell a portion of his holdings in GoPro, but said "no one should misunderstand my commitment to the company or our vision. As I told investors on our earnings call last week, I plan to be a significant shareholder in GoPro for a long time."

WHAT'S NOTABLE: On October 1, Nicholas and Jill Woodman, the husband and wife founders of GoPro, announced they gave a personal gift towards establishing a new charity, The Jill + Nicholas Woodman Foundation. The lead book-running managers of the company's June IPO, JPMorgan, has agreed to release the organization from a lock-up restriction with respect to the 5.822M shares of the company's common stock gifted, effective on October 3, the company noted at that time. Afterward, Mari Ellen Loijens, chief business, development and brand officer for the Silicon Valley Community Foundation that now controls the shares, said the foundation wanted to be "very thoughtful about the sale process” and did not intend to sell right away, according to The Wall Street Journal.

PRICE ACTION: In early trading, GoPro shares slid about 2% to $77.50. However, over the last three months the stock has more than doubled, as it was trading at $37.65 on August 8.

Reporting by Jason Keil.

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