The Zip Co Ltd (ASX: Z1P) share price is pushing higher on Tuesday despite revealing a large number of insider sales.
At the time of writing the buy now pay later provider's shares are up 0.5% to $6.03.
Who has been selling Zip Co shares?
This morning Zip Co advised that a number of directors have sold shares this month.
This includes Managing Director Larry Diamond, Chairman Philip Crutchfield, and Company Secretary David Franks.
According to one change of director's interest notice, Mr Diamond offloaded a total of ~5.5 million through a series of on-market trades between 18 June and 19 June. The managing director received an average of $6.125 per share, which equates to a total consideration of ~$33.7 million.
Another notice reveals that Mr Crutchfield sold 1 million shares through a series of on-market trades between 18 June and 22 June. The chairman received an average of ~$6.11 or a total consideration of $6.11 million.
Finally, the third notice shows that Mr Franks has offloaded 1.3 million shares through on-market trades on 18 June and 19 June. The company secretary received an average of $6.12 per share, which equates to a total consideration of just under $8 million.
Why have they been selling shares?
In response to the sales, Zip Co released an announcement which explains why the sales were made.
According to the release, the directors sold these shares to pay personal and/or related party tax obligations, reduce personal and/or related party debt commitments, and to allow them to diversify a minor part of their total investment in Zip Co.
It is worth noting that these directors are still heavily invested in the company, which I believe means their interests remain firmly aligned with shareholders.
In fact, although these were sizeable sales, in aggregate, the directors sold less than 10% of their holdings in the company. Furthermore, all three directors have confirmed that they have no present intention to sell any further shares in the medium term.
