Rumble (NASDAQ: RUM) (“Rumble” or the “Company”), a video-sharing platform and cloud services provider, announced a definitive agreement for a $775 million strategic investment from Tether ($USDT). Tether, the largest company in the digital assets industry and the most widely used dollar stablecoin globally with over 350 million users has become a prominent symbol of financial inclusion in recent years.
Rumble plans to allocate $250 million of the proceeds to drive growth initiatives. The remaining funds will be used for a self-tender offer to repurchase up to 70 million shares of its Class A Common Stock at $7.50 per share, the same price as Tether’s investment. Chris Pavlovski, Rumble’s Chairman and CEO, will maintain his controlling interest in the Company after the transaction.
Here’s what went into the deal.
- Investment: Tether will acquire 103,333,333 shares of Rumble Class A Common Stock at $7.50 per share, resulting in $775 million in gross proceeds to Rumble. $250 million of these funds will support growth initiatives.
- Self-Tender Offer: The remaining funds will finance a self-tender offer for up to 70 million Class A Common Stock shares at $7.50 per share in cash. All Rumble Class A stockholders can participate under the same terms. Certain stockholders have signed agreements to tender a total of 70 million shares, subject to the same terms as all participants. Chris Pavlovski has committed to tender up to 10 million shares.
- Closing Conditions: The transaction is subject to standard closing conditions, including the expiration of the Hart-Scott-Rodino Antitrust Improvements Act waiting period.
- Governance: Rumble’s existing Board structure and governance, including Chris Pavlovski’s super-majority voting control, will remain unchanged. Tether will hold a minority stake in Rumble’s outstanding stock without the right to appoint Board members.
Timing: The transaction, including the investment and tender offer, is expected to close in Q1 2025.
Source: Rumble
