- Last Updated: 12:00 AM, March 3, 2012
- Posted: 11:30 PM, March 2, 2012
A LoopNet insider has dumped shares as federal regulators continue to probe the company’s proposed tie-up with rival CoStar, raising red flags for shareholders wondering whether the deal will get approval.
LoopNet’s head of product and business development, Frederick Saint, cashed out half his stock, or 25,000 shares, on Feb. 29 for a total of $460,000, according to a regulatory filing.
While it’s not unusual for insiders to sell shares, the timing of the sale raised questions about his confidence in the deal getting done.
“Perhaps he is worried that the deal actually is in trouble,” said one trader who is shorting shares of LoopNet. “I can’t think of another reason why he would sell if indeed the deal was about to close.”
The Federal Trade Commission has been probing CoStar’s proposed merger with LoopNet, which would create the dominant provider of commercial real-estate data.
Shares of LoopNet have risen 6 percent since the company said in a Feb. 24 filing that it was “hopeful” the deal with CoStar would get the green light.
LoopNet’s shares yesterday fell 11 cents to close at $18.27.
CoStar has agreed to buy LoopNet in a cash and stock merger that values the company at roughly $18.68 a share.
Regulatory attorney Bill Singer said that when he sees a move like this, “You always assume the worst. You should assume people will infer it is a vote of no confidence.”
“Rest assured,” he said, if the deal is blocked, “shareholders will be screaming.”
Neither LoopNet nor Saint returned calls.