Rumble stock soars after video platform receives $775 million investment from Tether

Rumble (RUM) stock price rose 60% on Monday morning after the video platform received a $775 million investment from Tether, the operator of the cryptocurrency platform and creator of the stablecoin of the same name. It skyrocketed.

Rumble announced that Tether purchased 103.3 million Rumble shares at $7.50 per share. The company noted that the transaction does not change CEO Chris Pavlovsky’s status as the company’s majority shareholder.

The company said it would use $250 million of the proceeds “to support our growth strategy and the remaining proceeds to fund a tender offer of up to 70 million shares of our Class A common stock at the same price.”

Pavlovsky called Tether “the perfect partner to support Rumble as we prepare for our next phase of growth.”

Tether CEO Paolo Ardoino added that in addition to the investment, the company plans to build “meaningful advertising, cloud and crypto payment solutions relationships with Rumble.”

Oppenheimer says deal ‘should alleviate investors’ concerns about liquidity’

In a note to clients, Oppenheimer wrote that the transaction “should alleviate investor concerns regarding liquidity” before becoming free cash flow positive for Rumble. The stock is rated “perform”.

The transaction is expected to close in the first quarter of 2025.

Rumble stock soared 61% shortly after the opening bell to $11.61, its highest price since November 2022.