The shares of the Israeli company Pagaia crashed on Wall Street by about 67% to below the price of 2.3 dollars per share, and this against the background of the release of the blocked shares to the market. The founders of the company and prominent shareholders who could not sell their holdings are apparently doing so now and on a significant scale, out of a strong desire to meet the money as long as possible.
The company was issued on Nasdaq last June by way of a merger with SPAC under the name EJF Acquisiyion. The value attached to the issue was 8.5 billion dollars and in less than a month the stock fell and the value of the company dropped to only 2 billion dollars. However, since then the stock has been flying without finding a convincing explanation in the market, Thus a situation was created in which it became the largest Israeli company in New York with a value of 20 billion dollars, and this while still a loss-making company.
After the company reached an imaginary value like this, as a result the blocking release period was brought forward, and half of the blocked shares were released today. The rest will be released on December 19. The reasons for the meteoric rise in the stock were attributed to the lack of floating goods and the closing of shorts, but it is still not clear if this is the reason. What’s more, the reason for the collapse now can be attributed to the release of the blocked shares.