"Buy the rumor, sell the news" is one of Wall Street's oldest investment saws -- and on Thursday, it proved prescient.
For months, investors have awaited confirmation that the special purpose acquisition company (SPAC) Forum Merger II Corporation (NASDAQ:FMCI) would successfully close its reverse IPO with plant-based packaged-foods maker Tattooed Chef. On Thursday, that confirmation finally arrived -- and Forum Merger stock promptly plummeted 8.1% by close of trading.
Forum Merger announced this afternoon that it has consummated its merger with Tattooed Chef owner Ittella International. As of tomorrow, trading in Forum Merger stock will accordingly cease and trading in the renamed company's new stock ticker -- TTCF -- will begin.
It's not immediately clear why investors, who have awaited this development for months, are disappointed now that it has come to pass. The company's merger announcement didn't contain any negative surprises regarding sales or earnings, for example. To the contrary, Tattooed Chef CEO Sam Galletti says the company possesses "significant growth opportunities" and promises "to accelerate that growth" now that the company is being traded publicly.
Nevertheless, with the merger announcement no longer something that investors can look forward to, they now appear to be selling Tattooed Chef and moving on to look for new opportunities.