Facebook to sell 25% more shares

Wed, May 16, 2012, 01:00

Facebook said today that 25 per cent more shares will be sold as investors clamour for a piece of the year’s hottest stock offering.

Facebook said in a regulatory filing that about 421 million shares will be sold, up from 337 million under earlier plans. That total does not include more than 63 million additional shares the deal’s underwriters can sell to cover
excess demand.

The news comes the day after Facebook raised the expected price range for the stock to $34 to $38 per share, up from $28 to $35.

The offering is expected to set the final price tomorrow evening. Shares would start trading on the Nasdaq on Friday under the “FB” ticker symbol.

If all the shares, including those being offered to the underwriters, are sold at the high end of the expected price range, the social network’s offering could raise more than $18.4 billion. That would make Facebook
one of the biggest ever initial public offerings (IPOs), eclipsing the $2 billion debut by Google Inc in 2004.

The company’s IPO is the most hotly anticipated in years and would value Facebook overall at more than $100 billion dollars.

In a filing with the Securities and Exchange Commission, Facebook says the extra shares being made available are coming from its current shareholders. The selling shareholders are offering approximately 241 million shares, up from
about 157 million.

Facebook will not receive any proceeds from the stock sold by the selling shareholders.

The regulatory filing also disclosed that chief executive Mark Zuckerberg will control about 55.8 per cent of the voting power of the company’s outstanding capital stock following the offering. This is down slightly from the 57.3 per cent he was initially expected to have.

Facebook said it arrived at the higher IPO price range after one week of marketing the offering - part of a cross-country roadshow in which Mr Zuckerberg has taken the stage to lay out his vision for the company's money-making potential and its top priorities.

Facebook has more than 900 million users who log in at least once a month.

Morgan Stanley leads the team of 33 underwriters selected for the Facebook offering, followed by JPMorgan Chase and Goldman Sachs.

AP/Reuters