Facebook Boosts Size of IPO by 25% as More Insiders Cash Out

Facebook ipoNEW YORK -- Insiders and early Facebook investors will be unloading more of their shares in the initial public offering, the company said Wednesday, as they take advantage of investor demand.

Facebook said in a regulatory filing that 84 million shares, worth up to $3.2 billion, will be added to the offering.

The entire increase comes from insiders and early investors, so the company won't benefit from the additional sales.

The biggest increases come from investment firms DST Global and Tiger Global. Goldman Sachs is doubling the number of shares it is selling. Facebook board members Peter Thiel and James Breyer are also selling more shares.

Founder Mark Zuckerberg isn't increasing the number of shares he's selling.

The news comes a day after Facebook raised the expected price range for the stock to a range of $34 to $38 per share, up from its previous range of $28 to $35. Also Tuesday, major advertiser General Motors Co. said it would stop advertising on Facebook.

At the high end of the price range, the IPO would raise $16 billion without the overallotment option reserved to meet extra demand. That would make it the third-largest U.S. IPO in history, ahead of General Motors in 2010, according to Renaissance Capital.

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

In a filing with the Securities and Exchange Commission, Facebook said current shareholders are now offering approximately 241 million shares, up from about 157 million shares previously.



Even though Zuckerberg isn't increasing the number of shares he is selling, the additional sales will trim his voting control to 55.8 percent from 57.3 percent. That's because he has voting control over some shares now owned by investment firms, which will be sold in the offering.

Facebook has more than 900 million users who log in at least once a month, but it makes only a few dollars per year from each one, chiefly through advertising. Advertisers have been complaining that it's difficult to make good use of Facebook.

GM did not say why it would stop advertising on Facebook. The Wall Street Journal reported, citing people it did not identify, that it was because GM had concluded that the ads were ineffective.

GM spokesman Greg Martin said the company will keep paid content on pages that promote its products. Meanwhile, GM competitor Ford reaffirmed its commitment to Facebook, saying its relationship was stronger than ever.

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

The offering is expected to get a final price Thursday evening. Shares would start trading on the Nasdaq on Friday under the "FB" ticker symbol.

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findrobin

LMFAO HAHAHAHAHAHAHAHAHAALOLOLOLOLOLOLOLOLOLHAHAHAHAHAHAHAHJAJAJAJAJAJAJAJAJLOLOLOLOLOL. I'm sooooooo happy. Serves all the losers right. The company is a fad. It will go down soon. I don't have a fakebooky page. CIA has enough on you already. The back rhis site to garner more stas on you silly children who play the fakebook game. HA friggin HA.

May 17 2012 at 9:46 AM Report abuse rate up rate down Reply
findrobin

And...

May 17 2012 at 9:43 AM Report abuse rate up rate down Reply
petepar1

Lets see insiders jump ship and cash out so fools who think the ship won't sink will hold it up .. I've seen the end of this movie before

May 16 2012 at 10:16 PM Report abuse +2 rate up rate down Reply
starserv1

Fcebook is dead. Twitter will be the social media, just talk to your college kid.

May 16 2012 at 10:09 PM Report abuse +1 rate up rate down Reply
stbird1innm

ok talentscreening, not bad info, but your missing the point. BUY the stock , double, triple your money and sell sell sell.......then we can watch the demise of facebook from the beachs of Hawaii...

May 16 2012 at 9:32 PM Report abuse +1 rate up rate down Reply
stbird1innm

Magic, your a genius, now go back to playing farmville

May 16 2012 at 9:29 PM Report abuse +2 rate up rate down Reply
Magic

once facebook puts a monthly price on its use, is when they entire network of facebook will fold...That is what happened to America Online, once they started charging people to use AOL, people disappeared, it will happen with facebook also, the only reason people use facebook now is because it is free. add it to your monthly expenses and people will get away from it...

May 16 2012 at 9:04 PM Report abuse +2 rate up rate down Reply
1 reply to Magic's comment
g5user1usa

Facebook stock is for suckers. Only Zuck is going to make any money. Facebook has no commercial value whatsoever. I'll bet the stock shoots up the first week and then collapses. Nobody is going to want to pay for using it, that's for sure. I only use it because so many sites have Facebook sign-ins.

May 17 2012 at 5:04 AM Report abuse +2 rate up rate down Reply
1 reply to g5user1usa's comment
GARY110252

Exactly! And when the stock shoots up to the moon, that's when the Wall Street "Insiders" will
sell them all off to the suckers...just before it collapses!

May 17 2012 at 6:46 AM Report abuse +2 rate up rate down
Magic

advertising on facebook is very expensive, and does not wok whatsoever....

May 16 2012 at 8:57 PM Report abuse +2 rate up rate down Reply
Mentallect

Under no circumstance will I invest in Facebook. Insiders made a whopping sum cashing out their shares before Normal Joes got a bite at the apple. The stock may or may not tank, or be overvalued, but either buy the share on day one like insiders or not at all.

May 16 2012 at 8:57 PM Report abuse +2 rate up rate down Reply
xfk

Ya before it dies

May 16 2012 at 8:41 PM Report abuse +1 rate up rate down Reply