Facebook Increases IPO Range, Valuation Exceeds $100 Billion

FILE - In this Jan. 3, 2011 file photo, shows Facebook CEO Mark Zuckerberg smiling in San Francisco. Zuckerberg turns 28 on Monday, May 14, 2012. He's considerably younger than the average FORTUNE 500 CEO, of course. But while some investors worry that Zuckerberg is too young to lead Facebook as a public company, experts point out that Bill Gates, Steve Jobs and Michael Dell were in their 20s when their companies had IPOs. (AP Photo/Paul Sakuma, File)

NEW YORK/SAN FRANCISCO, May 14 (Reuters) - Facebook Inc has raised the price range on its initial public offering to $34 to $38 a share in response to strong demand, a source familiar with the situation said, giving the No.1 social network a valuation exceeding $100 billion.

At the mid-point of $36, Facebook would raise $12.1 billion by selling 337.4 million shares. The company founded in a Harvard dorm room by Mark Zuckerberg, who turned 28 on Monday, had originally aimed for $28 to $35 a share.

Wall Street had expected the company to increase the price range, with investors keen to get in on Silicon Valley's largest ever IPO that eclipses Google Inc's 2004 debut. Its roadshow began last week and has drawn crowds.

The company plans to close the books on its IPO on Tuesday, two days ahead of schedule and in a signal that the landmark initial share sale is drumming up strong demand, a second source familiar with the deal told Reuters earlier.

The social network is scheduled on Thursday to price its shares, then begin trading on Friday.

The IPO is already "well oversubscribed," which is why the company is closing its books earlier than anticipated, the source said.

The raised price range marks an increase of 21 percent on the lower end. A hike of more than 20 percent typically means the company would have to file an amendment with the Securities and Exchange Commission.

Company spokesman Jonny Thaw declined to comment on Monday.

The IPO comes amid concerns from some investors that Facebook hasn't yet figured out a way to make money from an increasing number of users who access the social network on mobile devices such as smartphones.

Facebook will continue with its roadshow for the rest of the week, said a third source familiar with the deal, and investors who haven't yet attended a roadshow presentation will still be able to place orders.

Company executives met with prospective investors in Chicago on Monday and are slated to travel to Kansas City and Denver, before returning to Menlo Park, California, where Facebook is headquartered.

A host of Wall Street banks are underwriting Facebook's offering, with Morgan Stanley, JPMorgan and Goldman Sachs serving as leads. Facebook will trade on Nasdaq under the symbol FB.

CNBC reported the higher price range earlier, citing sources.

Related on HuffPost:

From our partners

Comments

[isfturtle]

01:08 PM on 05/15/2012

Still deciding whether or not to buy some shares...

[Antoinette Meijrink]

10:53 AM on 05/15/2012

Seeling iss is the closest thing to closin Facebook down for crimes against humanity. Using the users to generate developement constituts enslavement and thanks to the sale will the Zuckerberg stand trial for misleading the public about the function of Facebook. Marks ownerhsip concerns the servers and the application mounted on the hardware?. Facebook is the property of the 902 million users and the University where project started.

[Antoinette Meijrink]

10:47 AM on 05/15/2012

Facebook a a Public commodity for Profits? Excuse me. Facebook is a Spititual Properti Content. So where did he have the idea he could sell Spiritual Property a Content and make it out to shareholders per package of Spititual Property a Content.. I can only assume the people who buy such a thing want to go down in History as the people who wanted to kill the Global Population.Mark doesn't even consider decimation a crime, just like his grandfather doesn't believe he will pay for his craime against humanity..

[Orph1969]

09:28 AM on 05/15/2012

Here's one idiot who has an order in for a few hundred shares on this IPO.

You don't argue with a 902 million active monthly user or 536 million active daily user rate. In this economy, where people are working harder than ever with less leisure time, and in this society, where we are too exhausted and too scared of the nebulous "other" about which we're told by the nightly news we need to be terrified, people use applications like FB to substitute for the human connection we all crave. We don't have time to visit cousin Suzie, but we can feel like she's still living 10 minutes away when we see the photos of her new baby, or the pics from her birthday party. We can celebrate with her when her daughter graduates college, or when her husband's biopsy comes back negative.

We used to socially connect at family gatherings, or at church, or at school. Now, no one has time for all that, and it's "a scary world out there." Hence, Facebook.

So, since the economy and society aren't going to cure themselves overnight, FB seems like a pretty save place to put some money for a couple of years. It will at least double by month's end, and stands to reach google-like scope and scale (though probably not share price).

Should be interesting to watch.

[Rich914]

08:55 AM on 05/15/2012

$100 billion! That's a lot of friends.

[obinna000]

08:25 AM on 05/15/2012

I will prefare to wait for a little while, till the shares become penny stocks before buying.

[Zealy Black]

08:20 AM on 05/15/2012

he needs to put college, HS and summer students to work!,

[notrightorleft]

08:34 AM on 05/15/2012

Are you assuming he does not already?

[mrdynamite1]

07:53 AM on 05/15/2012

Just heard Eduardo Saverin, Facbook co-founder, is gonna renounce his US citizenship so when this IPO is issued he won't be subject to US taxes on the goliath fortune he will make.

Educated in the US, company founded in the US, Company listed in the US. The US made Eduardo Saverin one of the world's richest men. And for the sake of money he is going to renounce the country that made him rich so he can keep a larger share of the pile of money he will never be able spend in his lifetime.

What an unbelievably ungrateful, shallow and spiteful small minded little man he is. To him money is more important than loyalty to the country that gave him every last penny he now has. Sickening.

[notrightorleft]

08:34 AM on 05/15/2012

He does not even live in the US, so why should he pay US taxes? There are fewer than five countries in the world that tax their citizens who live abroad, and none are what you would consider Western, progressive countries.

[baseball guy]

09:04 AM on 05/15/2012

Are you saying the US isn't Western or Progressive?

[roybus]

07:51 AM on 05/15/2012

Meanwhile co -founder Eduardo Saverin gave up his US citizenship to avoid paying around $600 million in tax when he picks up his share of the site's stock offering.

[Iva 123]

07:46 AM on 05/15/2012

One big solar explosion and there electricity go out for few years, and out go the value of Facebook. Who are the idiots who are buying the stocks.

[CaptainKlutz]

07:45 AM on 05/15/2012

Good for him.

I understand that he gets regular advice from Bill Gates on philanthropy so hopefully he can channel some of that fortune into helping others.

[AlohafromMrHand]

07:40 AM on 05/15/2012

Just another billionaire liberal Obama worshiper .

[Kane Kinnebrew]

07:52 AM on 05/15/2012

what's not to like

[dogtac69]

08:26 AM on 05/15/2012

AlohafromMrHand

I wish I were one.

[bettydonnelly]

07:38 AM on 05/15/2012

Just an indication of how sick this society is . Millions of lonely people wasting countless hours on Facebook and Twitter.

[Mikey456]

07:32 AM on 05/15/2012

I sure hope he's paying his "fair share"

[Knev Knev]

07:11 AM on 05/15/2012

Woow Facebook growing faster then expected, he need to take this different levels.