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Best Buy CEO sells stock due to divorce

Some New Mexico residents may have heard that Best Buy CEO Hubert Joly recent sold more than 350,000 shares of stock valued at approximately $10.4 million. This act may have initially led to some speculation that Joly does not have faith in the future of the company. However, a spokesperson for Joly released a statement that Joly retains a large investment in Best Buy. Best Buy's stock has increased 207 percent over the past year, and Joly is largely credited with the company's recent successes.

There is a much simpler explanation for the sale. Joly is currently undergoing a divorce. He sold the stock to cover related expenses. It was not stated whether the money was needed for alimony, attorney's fees or other expenses.

People do sometimes follow unusual stock market activity for evidence of inside information. Large purchases and sales must be disclosed to the Securities and Exchange Commission and are therefore public information. However, because there are a number of reasons that a person might sell stock that are unrelated to the company itself, large stock purchases are usually more telling. An executive usually buys stock because he thinks the price will increase. That same executive might sell shares for non-business reasons, such as a divorce.

Divorce proceedings can be contentious, especially where one spouse has significant assets. A family law attorney might be able to help negotiate some of the more volatile issues, such as child custody, child support, division of high-value assets and spousal support. It may also be possible for an attorney to help draft documents to facilitate the transfer of assets such as cars, houses, stock or retirement accounts from one spouse to the other.

Source: USA Today, "1 reason to sell Best Buy stock: D-I-V-O-R-C-E", John Waggoner, September 12, 2013

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