When a company goes public, it's not unusual for the shareholders who took the company there to cash in after a time by selling part or all of their shares. It's a way to get at least a partial return on their investment.
Luxury home furnishings retailer Restoration Hardware (NYSE:RH), which had its IPO back in April, announced today that it registered for a follow-on offering so that certain shareholders who had taken the company public could sell their stock to the public. The company will not receive any of the proceeds from the offering.
Among those who will be selling their shares will be private equity firm Catterton Partners and company founder Gary Friedman, the company's once and future co-CEO. He had stepped down last year from the position after an investigation showed he was involved in a personal relationship with an employee. Restoration Hardware announced his return to the co-CEO position earlier this week.
At the time of the IPO, it was estimated Catterton owned a 32% stake in the home furnishings company while Friedman owned 16%. The number of shares to be sold by the stock owners has not yet been determined.