Facebook Sets IPO Price Between $28-$35; Below What Many Expected
New York City -
Facebook has set a price range between $28-$35 for its IPO stock sale and will use the ticker symbol FB. At the midpoint of that price, it would give Facebook a valuation of about $86 billion. This is well below what may analyst had expected, who foresaw a value at around $100 million.
Despite the lower than expected price, it will still be the fifth largest IPO in the United States, and will be the largest valued company to ever go public in the US. "I'm surprised they took it down," says Josef Schuster of IPO tracking firm IPOX Schuster.
Facebook's first quarter earning were a big let down for many due to the much slower growth in new accounts. Facebook's revenue grew 45% in the first quarter to $1.1 billion, which was well below the 88% revenue growth during the full year of 2011. Profit fell 12% in the first quarter.
Additionally, Facebook founder Mark Zuckerberg is planning to sell 71.1 million shares of his personal holdings, or nearly 7% of his holdings, which should net him $2.2 billion.
Until the IPO, shares of Facebook were only available to select private institutions and investment funds.