Paper billionaire Ralph Bartel is looking to cash in some of his hefty stake in Travelzoo (TZOO:Nasdaq - news - research), the online travel Web site he founded and which happens to be the hottest stock of the year.
Late Wednesday, Bartel, who owns 85% of Travelzoo's stock, filed a registration statement to sell 750,000 shares, or roughly 4% of the 15.6 million shares he owns. Based on Travelzoo's closing price of $87.72, Bartel's planned sale would net him $65.8 million.
Along with Bartel, the company's primary investment banker, Wedbush Morgan, is registering 30,000 shares that it had previously obtained from Bartel in an October 2003 agreement. Last month, Bartel exercised options to transfer the shares to Wedbush Morgan.
The timing of Bartel's planned sale of stock is curious, however.
In October, the 38-year-old former advertising executive announced a plan to sell 750,000 shares. But he changed his mind after a group of hedge funds that invested in a $30 million private placement objected. The hedge fund investors had asked Bartel to delay selling any large block of stock until the Securities and Exchange Commission approves their application to sell another 750,000 shares.
As of early today, sources say the SEC had not yet approved the registration statement filed by Travelzoo on behalf of the hedge fund investors in the so-called PIPE, or private investment in public equity, investment.
One of the larger investors in the PIPE is E*Capital Corp., a principal shareholder in Wedbush Morgan.
Kelly Ford, Travelzoo's investor relations director, says the PIPE deal is not yet effective. He says Bartel's filing of the registration statement will enable him to sell shares no sooner than 15 days after the SEC approves the PIPE deal.
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