Facebook director sells $400 million in shares

What investors feared has happened: Facebook insiders have been dumping their shares of the company, dramatically increasing the volume of stocks traded and driving down prices for all shareholders.

That’s what Facebook director and PayPal cofounder Peter Thiel just did last week, cashing out most of his stake in the company, a whopping $400-million worth of shares, according to regulatory fillings.

He did so right after the end of the first so-called lockup, which barred company insiders and early investors from trading Facebook shares for a given period after the initial public offering. Thiel sold his shares on Thursday and Friday at prices ranging between $19.27 and $20.69 per share. That was down nearly 50 per cent from the stocks’ offering price of $38 a share in May.

And with four more lockups, worth another 1.64 billion shares, set to expire in October, November, December and next May, Facebook’s stock price is likely to continue to tank.