DealBook: Bain Capital Seeks to Cash Out of LinkedIn

Michael Nagle/Bloomberg NewsThe start of LinkedIn’s first day of trading.

With LinkedIn‘s shares still flying high six months after their debut, one of the company’s early backers is cashing out.

Bain Capital plans to sell its entire stake, about 3.7 million shares, as part of a secondary stock sale that LinkedIn announced late on Monday. The investment firm took a piece of LinkedIn when it led a $53 million financing round for the social networking company in 2008.

Two other venture capital firms backing the company, Greylock Partners and Bessemer Ventures, plan to sell smaller amounts of stock.

All told, insiders will sell more than 6.2 million shares in LinkedIn. Other selling shareholders include LinkedIn’s chief executive, Jeff Weiner; its chief financial officer, Steven Sordello; and a director, David Sze. All are selling about 10 percent of their holdings.

LinkedIn’s co-founder, Reid Hoffman, isn’t selling any shares.

The insider sales will come after the expiration of a six-month lockup instituted when LinkedIn went public in May at $45 a share. Since then, the company’s stock has risen 62 percent, though its shares fell about 7 percent by midday on Tuesday.

LinkedIn itself will also sell nearly 1.3 million shares, but could sell up to 1.2 million additional shares if there’s strong investor demand. Proceeds from the new company-issued stock will go toward general corporate purposes.

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