The Federal Trade Commission (FTC) today cleared all of Facebook co-founder and CEO Mark Zuckerberg's paperwork ahead of the social network giant's $5 billion initial public offering (IPO). The FTC disclosed it has agreed to expedite the approval of Zuckerberg's filing, terminating the usual 30-day waiting period, in a very short document titled "TRANSACTION GRANTED EARLY TERMINATION" (PDF).
The notice relates to Zuckerberg's stock options, according to a person briefed on the matter cited by The New York Times. This type of disclosure is not that common for IPO stock sales, but because of the value of Zuckerberg's options, a filing was necessary.
Zuckerberg has a 28.4 percent stake in the company, but that he also has voting control over at least 57.1 percent of Class B shares through a chain of agreements with other shareholders, which he bought for $100 apiece. Given how much of the company he controls, Wall Street isn't too pleased at how dismissive Zuckerberg is of investors.
Earlier this week, a rumor suggested Facebook is halting the trading of its shares on secondary markets by the beginning of April in advance of its IPO. If true, the move will end price fluctuations in private trading, giving Facebook time to account for its shareholding base as it makes final preparations for its IPO, including determining a valuation with bankers and investors.
The pieces are falling in to place for the company's long process to go public. It's important to remember that we won't know what the company's actual valuation is until right before the offering is made, which typically occurs about three months after the company files for its IPO. Indeed, the latest rumor slates May 2012 as the expected timeframe for Facebook going public. An exact date still hasn't been determined, but you can expect those rumors to start soon.
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