Vinco Ventures (NASDAQ:BBIG) stock is plunging lower today following news of an attempted hostile takeover and a postponed special stockholders meeting.
Last night, Vinco put out a press release detailing an attempted hostile takeover by the Farnsworth Group. The Farnsworth Group consists of former co-CEO Theodore Farnsworth, former ZVV Media Partners President and Vinco CEO Lisa King, former Chief Security Officer Erik Noble and former Chairman Roderick Vanderbilt. The company terminated all four executives following the attempted takeover.
Oddly enough, this takeover press release was deleted from Vinco Ventures’ website. However, the release is still visible on various news sites.
On top of the takeover news, the company has also postponed its stockholders meeting to Aug. 23. Vinco says it is delaying the meeting to give BBIG stock investors more time to “consider and vote on the proposals.” Shareholders will still be voting on the same proposals, which are about increasing the number of common shares outstanding to 750 million and increasing the number of preferred shares to 30 million.
With that in mind, let’s jump into the details of the hostile takeover attempt.
BBIG Stock Plunges on Hostile Takeover Attempt
The now-deleted press release details the events from July 14 to July 24 that led up to the hostile takeover attempt.
On July 14, former CEO Lisa King first authorized a Form 8-K that incorrectly stated the appointment of Farnsworth as co-CEO. Vinco advised King that the form contained incorrect information, but the executive filed it anyway. When the company attempted to file a corrected 8-K, members of the Farnsworth Group blocked the form.
Three days later, Vinco’s board decided to terminate King as CEO and as the Vinco Manager of ZVV. In her place, the company appointed John Colucci as interim co-CEO. Then, on July 21, the board rescinded King’s termination and appointed her as the President of ZVV. The board also confirmed Colucci’s appointment and appointed Farnsworth as co-CEO. Then, on July 22, the board says certain members of the Farnsworth Group filed an incorrect 8-K. Apparently, the form “materially misrepresented the facts and chain of events.”
On the same day, Vinco paid $33 million to satisfy arrangements for senior secured promissory notes. The company says this was “potentially due to the action or inaction of certain members of the Farnsworth Group.”
Vinco Terminates the Farnsworth Group
On July 24, Vinco terminated the positions of the Farnsworth Group. The company also “ratified and confirmed” John Colucci as interim CEO. Vinco attempted to disclose this via an 8-K, but the Farnsworth Group subsequently blocked it.
Looking forward, Vinco says it will file the necessary 8-K once it resolves its management issues. Colucci says the company is currently stabilizing itself.
Making matters more confusing is a tweet from Vinco’s controlling shareholder ZASH:
The July 22nd, 2022 8k still stands – nothing has changed. The recent statement by Vinco Ventures was not authorized on GlobeNewswire https://t.co/GdRSlPnXIm
— ZASH (@ZashGlobal) July 26, 2022
Clearly, Vinco is currently going through some severe management issues. When it comes to BBIG stock, investors would be wise to stay on the sidelines for now, until more information is released or the issue is resolved.
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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.
