Breaking News
FONT-SIZE Plus   Neg
Share SHARE

Reports: Facebook To Pay Underwriters 1.1% Fee In IPO

RELATED NEWS
Trade GOOG now with 

Facebook will pay only a 1.1 percent fee to the 31 underwriters of its much anticipated initial public offering, according to media reports on Monday. The rate is said to be much smaller than the 6 percent to 7 percent fee that is typical on Wall Street.

But Facebook's underwriters are reportedly willing to share a smaller fee as the absolute size of the payout for the high-profile IPO will still be large. They are also said to be lured by the promise of being bankers in future to the world's largest social networking site.

Menlo Park, California-based Facebook disclosed in a regulatory filing in February that it has filed for an IPO of up to $5 billion of its Class A common stock, valuing the company at about $100 billion. The social networking site intends to apply to list its common stock under the symbol "FB".

Assuming Facebook raises $5 billion from its IPO, its underwriters will get $55 million. Morgan Stanley, the lead underwriter, will probably earn a bigger cut of the total.

In early March, Facebook said it added 25 new underwriters and secured two new credit facilities totaling $8 billion as it prepares for its IPO.

The new underwriters that have been added include banks such as Citigroup Inc., Credit Suisse Group AG, Deutsche Bank AG, RBC Capital Markets LLC and Wells Fargo Securities LLC. Facebook also added 20 smaller companies as underwriters. The additions take the total number of underwriters for its IPO to 31.

Register
To receive FREE breaking news email alerts for Google Inc. and others in your portfolio

by RTT Staff Writer

For comments and feedback: editorial@rttnews.com

Business News

Editors Pick
LinkedIn Corp., the world's largest online professional network, said Thursday after the markets closed that it swung to a second quarter loss, hurt by higher costs and expenses even as revenue surged 47%. However, the company's quarterly earnings per share, excluding items, came in above analysts' expectations as did its quarterly revenue. Kraton Performance Polymers, Inc. (KRA), Wednesday reported second-quarter net income of $11.1 million or $0.33 per share, up from $3.8 million or $0.12 per share last year. Adjusted earnings improved to $0.46 per share from $0.15 per share last year. Revenues for the quarter dropped to $323.8... Organic grocer Whole Foods Market, Inc. said Wednesday after the markets closed that its third quarter profit rose 6.3% from last year, as same-store sales increased 3.9%. The company's quarterly earnings per share also came in above analysts' expectations, but its quarterly sales fell shy of analyst' forecast.
comments powered by Disqus
FREE Newsletters, Analysis & Alerts

 

Stay informed with our FREE daily Newsletters and real-time breaking News Alerts. Sign up to receive the latest information on business news, health, technology, biotech, market analysis, currency trading and more.