Facebook increases IPO by 25%

Facebook increases IPO by 25%

Summary: Facebook has increased its initial public offering (IPO) size to some 421 million shares. Facebook could thus raise a total of between $14.32 billion and $18.47 billion, if you include over-allotment.

SHARE:

As expected, Facebook today once again updated its filing for an initial public offering (IPO) with the U.S. Securities and Exchange Commission (SEC). This is the eighth time it has done so, and the biggest change is that has increased the number of IPO shares by 25 percent.

Here's the relevant text in the seventh amendment:

Facebook, Inc. is offering 180,000,000 shares of its Class A common stock and the selling stockholders are offering 157,415,352 shares of Class A common stock. We will not receive any proceeds from the sale of shares by the selling stockholders. This is our initial public offering and no public market currently exists for our shares of Class A common stock. We anticipate that the initial public offering price will be between $34.00 and $38.00 per share.

Here's the changed text in the eighth amendment:

Facebook, Inc. is offering 180,000,000 shares of its Class A common stock and the selling stockholders are offering 241,233,615 shares of Class A common stock. We will not receive any proceeds from the sale of shares by the selling stockholders. This is our initial public offering and no public market currently exists for our shares of Class A common stock. We anticipate that the initial public offering price will be between $34.00 and $38.00 per share.

Previously, given the sale of some 337.4 million shares, the price range meant Facebook could raise between $5.04 billion and $6.30 billion for itself, as well as between $4.41 billion and $5.51 billion for its investors. On Tuesday, given the sale of 337.4 million shares and the extra 63,185,042 shares of Class A common stock that might be sold to cover over-allotments, the new price range meant Facebook could raise anywhere between $13.19 billion and 14.75 billion.

As of Wednesday (today), Facebook is offering some 421.2 million shares. This means Facebook could raise anywhere between $14.32 billion and $16.01 billion. If you include the over-allotment, meaning a grand total of 484.4 million shares, Facebook could raise anywhere between $16.47 billion and $18.41 billion. It's important to emphasize that Facebook itself is still selling the same number of shares, while it's investors are the ones upping the ante.

The following is an updated list of parties that plan to unload part of their stake:

  • Accel Partners: 49.03 million shares, leaving it with around 152.35 million shares.
  • DST Group: 45.66 million shares, left with around 85.62 million shares
  • Goldman Sachs: 28.67 million shares, left with around 37.27 million shares.
  • Elevation Partners: 4.62 million shares, left with around 35.49 million shares.
  • Greylock Partners: 7.61 million shares, left with around 29.05 million shares.
  • Mail.ru Group: 19.60 million shares, left with around 36.75 million shares.
  • Zynga CEO Mark Pincus: 1.01 million shares, left with around 4.30 million shares.
  • Meritech Capital Partners: 7.00 million shares, left with around 29.66 million shares.
  • Microsoft: Offering 6.56 million shares, left with around 26.23 million shares.
  • Reid Hoffman: 942,000 shares, left with around 3.77 million shares.
  • Tiger Global Management: 23.41 million shares, left with around 60.43 million shares.

All other parties plan to keep holding their shares. These include T. Rowe Price, Andreessen Horowitz, Sean Parker, and Dustin Moskovitz.

Facebook's amended filing does not mention yesterday's news that General Motors (GM) plans to stop spending $10 million on Facebook ads, after concluding that they were not influencing consumers. Facebook changed its "cash, cash equivalents, and marketable securities" number from $10,312 million to $10,311 million, but that's not enough to represent the GM loss.

Here is the relevant document filed today with the SEC you may want to check out for more information: Amendment No. 8 to Form S-1 REGISTRATION STATEMENT.

Facebook is widely expected to start trading on the Nasdaq this week under the "FB" ticker. Many believe this Friday is the big day; shares will be priced on May 17, with trading beginning on May 18. Another rumor says there could be a delay, but as every day passes, that seems less and less likely.

See also:

Topics: Legal, Banking, Social Enterprise

Emil Protalinski

About Emil Protalinski

Emil is a freelance journalist writing for CNET and ZDNet. Over the years,
he has covered the tech industry for multiple publications, including Ars
Technica, Neowin, and TechSpot.

Kick off your day with ZDNet's daily email newsletter. It's the freshest tech news and opinion, served hot. Get it.

Talkback

6 comments
Log in or register to join the discussion
  • i think FB is another bubble

    is face book getting greedy or is it a wall street frenzy? personally, i haven't seen what is face books cash flow really is and whether they can actually pay a return on stock dividends.

    we know that gm is pulling out of face books ads, thus there will be a 10 million dollar short fall for face book. the question is, will there be others to follow gm?

    the difference between face book and other companies, is that face book is not manufacturing new products. undoubtedly it has morphed from its original concept and intent. but its basically the same product that is saturating the market place which can ultimately have an inverse effect and burst.

    like ads that have saturated almost everything everywhere, people have learned to tune them out. face book may become something to be tuned out as well.
    databaseben
    • Totally agree!

      Since finally getting a smartphone a couple months ago, I go on facebook less and less. I'm not sure if that's is because of how integrated WP7 is with facebook or not, but as far as I'm concerned it could be any service that I'm using. The only reason I use facebook, and it's a 900 million big reason, is because the people I want to talk with use facebook.

      If there was some service that was a service like AIM, but with photo gallery you can restrict to your friends and status updates, and did NOT use my personal information to make money, I would much prefer to use that!
      ikissfutebol
  • Emil, why they need those crazy money?

    FB already spent huge amounts of money in its datacenters, software, services, whatever. They do not need any significant money for that any more.

    Besides plans to build their new office, what else they are gathering those crazy billions? What is the point in diluting shareholders equity so dramatically?
    DDERSSS
    • They have to go public.

      Once a private company has more than 500 investors, it must begin releasing quarterly financial information to the U.S. Securities and Exchange Commission (SEC).
      Empro
      • Thanks, but they already decided on huge IPO, why they continue to increase

        ... the volume -- this time, by another 25%?

        Where do they plan to spend all those additional billions? Just to make them into liquid assets, investing into low profit securities, as Apple does with their $110 billion? Just for that?

        They could make IPO much smaller, not gathering excessive money which they could not spend even if they would built 100 huge offices, but keep their existing pre-IPI shareholders value much higher.

        Am I wrong somewhere?
        DDERSSS
  • Advertising Overload

    I suspect that we are approaching the point that there is so much advertising that it starts to become irrelevant and generally ignored.
    Seems to me that GM saw this and had decided to put their advertising dollar to better use.
    Just saying .............
    da philster