Facebook Set for Biggest Tech Flotation, Share Price USD 38

Business » FINANCE | May 18, 2012, Friday // 13:10
Bulgaria: Facebook Set for Biggest Tech Flotation, Share Price USD 38 While the market opens at 9:30 am ET on Friday, Facebook's shares won't start trading instantly. Photo by CNN, courtesy to sec.gov

After four months of paperwork, hype and speculation, Facebook announced it has priced its IPO at USD 38 a share.

At that price, Facebook's IPO will raise USD 16 B, making it the largest tech IPO in history.

It's the third largest U.S. IPO ever, trailing only the USD 19.7 billion raised by Visa in March 2008 and the USD 18.1 billion raised by automaker General Motors in November 2010, according to rankings by Thomson Reuters.

The shares are expected to begin trading on the NASDAQ Global Select Market on May 18, 2012, under the symbol "FB."

While the market opens at 9:30 am ET on Friday, Facebook's shares won't start trading instantly. It typically takes time -- sometimes an hour or more -- for newly listed shares to begin actively trading on the day of their public debut.

Facebook is offering 180,000,000 shares of Class A common stock and selling stockholders are offering 241,233,615 shares of Class A common stock.

Closing of the offering is expected to occur on May 22, 2012, subject to customary closing conditions.

In addition, Facebook and the selling stockholders have granted the underwriters a 30-day option to purchase up to 63,185,042 additional shares of Class A common stock to cover over-allotments, if any.

Morgan Stanley, J.P. Morgan, Goldman, Sachs & Co., BofA Merrill Lynch, Barclays, Allen & Company LLC, Citigroup, Credit Suisse and Deutsche Bank Securities are serving as book runners for the offering. RBC Capital Markets and Wells Fargo Securities are serving as active co-managers.

The offering will be made only by means of a prospectus.

Companies often explore an IPO once they have USD 100 M  in revenue. Facebook is expected to debut with more than USD 4 B in revenue.

The Facebook IPO has been long awaited since the hugely successful offering from online professional networking site Linkedln Corp. in Ma, which set the beginning of a new era of internet and social media companies floating on the stock market.

Facebook was launched in February 2004 by Mark Zuckerberg, its co-founder and chief executive, along with Harvard mates Dustin Moskovitz, Chris Hughes and Eduardo Saverin. It soon reached one million users by December 2004, 100 million users in August 2008 and 500 million users by July 2010.

It now counts 800 million users, while 4 billion items are shared per day.

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Tags: Facebook, IPO, Mark Zuckerberg
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