- Vinco Ventures (NASDAQ:BBIG) stock is falling after its spinoff of Cryptyde was pushed back
- The U.S. Securities and Exchange Commission (SEC) has not yet approved Cryptyde’s Form S-1
- Cryptyde will focus on cryptocurrency and Web 3.0 opportunities
Shares of Vinco Ventures are down 12% this morning after the company announced it was delaying the spinoff distribution date for Cryptyde. The record date for the spinoff occurred on May 18 and investors were expecting the distribution date to fall on May 27. Now, Vinco expects the new distribution date be sometime during the second quarter. The company says the delay is due to “contractual and regulatory conditions.”
After the spinoff, Cryptyde will trade under the ticker TYDE. Meanwhile, Vinco will continue to trade as BBIG stock. As its own company, Cryptyde will seek to capitalize on cryptocurrency and Web 3.0 opportunities in consumer-facing industries.
Let’s get into the details.
BBIG Stock: Vinco Ventures Pushes Back Cryptyde Distribution Date
Under the terms of the spinoff, Vinco shareholders are eligible for the Cryptyde distribution if they held shares of BBIG stock as of May 18. For every 10 shares of BBIG common stock held, shareholders will receive one share of TYDE. However, if a shareholder sells BBIG stock prior to the distribution, they cannot receive TYDE.
Shareholders of BBIG must continue to hold the stock until the distribution date in order to be eligible to receive shares of TYDE. In addition, the price of BBIG will likely fall after the distribution. This is because the stock will no longer reflect the future potential of Cryptyde.
Cryptyde has already filed a Form 10 to the SEC, which the agency approved. The Form 10 details information about and conditions for spinning off Cryptyde as a publicly traded company. However, the SEC has not yet approved Cryptyde’s Form S-1. That form is required in order to “register for resale certain shares of common stock held by investors in Cryptyde or issuable upon the conversion or exercise of securities held by investors in Cryptyde.”
Cryptyde filed its Form S-1 on May 9. The SEC needs to approve it before the distribution can occur. This is likely why the spinoff has been pushed back.
On the date of publication, Eddie Pan did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.