May 18, 2012
Facebook IPO Launches at $38 Per Share
Facebook announced that the IPO will be priced at $38 a share, valuing the company at over $100 billion. The flotation will raise approximately $16 billion for the company.
Facebook is expected to begin trading this week at approximately 11am on the NASDAQ. They will use the stock ticker “FB”.
They are on track to sell over 400 million shares as part of the IPO, with 60% of those expecting to be bought by insiders and other existing shareholders.
If the company release more shares via over-allotment it could raise over $18 billion, ranking it 2nd in the biggest IPO in US history, behind only the $19.7 billion that Visa raised in 2008.
“It’s about what we expected,” Josh Brown of Fusion Analytics told CNBC’s “Closing Bell” show. “I think the stock opens up at a premium from there.”
“It will probably be a positive for the market overall tomorrow,” Brown added. “This is a really dreary atmosphere, but something like a Facebook could really make people feel a little bit better about wading back into some NASDAQ names.”
The offering means that Facebook need to earn approximately $115 in profit from each of the 512 million active users it currently has to justify the valuation. The site currently earns approximately $1 in profit from each of these active users.
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