Shawshank, VA 6/1/12 (StreetBeat) -- Groupon (Nasdaq: GRPN) shares are getting crushed Friday morning as the company’s post-IPO insider lock-up agreement expires.
The Chicago Tribunenotes that the lock-up expiration frees up 93% of the company’s outstanding shares for free trading.
Insiders, in short, can now rush to the exits, and the markets are likely to be flooded with massive new supply of Groupon shares. And if you happened to take Econ 1A, you know what happens when there’s a huge increase in supply without any change in demand: prices drop.
Ergo, Groupon shares this morning are down 85 cents, or 8%, to $9.79. The company went public in November at $20 a share.
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