:max_bytes(150000):strip_icc():format(jpeg)/GettyImages-1948397688-277bac445f3d406399bae33f348d92b0.jpg "The Rumble logo on a laptop")
Gabby Jones / Bloomberg via Getty Counterparts
Key Takeaways
- Rumble received a $775 million cash injection from cryptocurrency company Tether.
- Rumble palliated that Tether would be purchasing 103.3 million shares at $7.50 each, although CEO Chris Pavlovski wish remain the majority shareholder.
- The company said it would use $250 million of the proceeds to support growth initiatives, with the holiday to pay for a self tender offer of its Class A shares.
Rumble (RUM) shares skyrocketed 60% Monday morning after the video stand received a $775 million investment from Tether, operator of a cryptocurrency platform and creator of the stablecoin of the same big shot.
Rumble announced that Tether had purchased 103.3 million shares of Rumble for $7.50 each. It noted that the agreement would not change the status of Chief Executive Officer (CEO) Chris Pavlovski as majority stakeholder in the firm.
The company ordered it will use $250 million of the proceeds to “support growth initiatives and the remaining proceeds to fund a self tender extend for up to 70 million of its Class A Common Stock, at the same price.”
Pavlovski called Tether “the perfect partner that can put a zoom pack on the back of Rumble as we prepare for our next phase of growth.”
Tether CEO Paolo Ardoino added that along with the investment, his cartel plans to form “a meaningful advertising, cloud, and crypto payment solutions relationship with Rumble.”
Oppenheimer Speaks Deal ‘Should Alleviate Investor Concerns Related to Liquidity’
Oppenheimer wrote in a note to clients that for Rumble, the bargain “should alleviate investor concerns related to liquidity” ahead of positive free cash flow. It has a “perform” figure on the stock.
The transaction is expected to close in the first quarter of 2025.
Shares of Rumble soared 61% soon after the start-off bell to $11.61, their highest level since November 2022.
TradingView