In what world is this true?

Facebook shares were expected to soar on Friday, but they shares finished just 0.6pc above their $38 offer price. Today\’s 12pc fall implies bankers got the flotation price wrong.

The company, the extant shareholders and the bankers got 12 pc more money for their shares on Friday than they were worth on Monday.

In what world is this a failure?

They were trying to sell, recall?

5 thoughts on “In what world is this true?”

  1. Well, it was a failure for the underwriting bankers (Morgan Stanley, JPM, Goldman Sachs et al) who had to support the shares at $38 on Friday and are left with a few $bn of them which they don’t have any realistic prospect of selling over $35 – which is a tad embarrassing at least.

    No, I don’t feel particularly bad for them either.

  2. Not even a failure for the underwriters, who sold more shares in the IPO than there actually were, and therefore ended up buying them back at either full price or a discount on Friday and Monday to give to people who were paying the full IPO price. See here.

  3. Pingback: That facebook IPO in full : Stoat

  4. Nope, as usual it was a failure for the buyers.

    Isn’t that the way IPOs are meant to work? Certainly it seems pretty usual. I’ve always thought that this is one of those areas where traditional British cynicism gives us a capitalistic edge over our boundlessly optimistic American cousins: they’re forever getting suckered by the next IPO, whereas we just snigger and wait for the inevitable discounted sale.

  5. Lots of bad failures here, including the underwriters changing their valuation during the grand tour, which is not illegal, but very much not OK.
    Expect class actions.

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