Facebook increases IPO size by 85 m shares on strong demand
The social network is scheduled on Thursday to price its shares, then begin trading on Friday.
After raising the price range to $ 34 to $ 38 a share, Facebook is now increasing the size of the initial public offering by 85 m shares to 422 million, a source familiar with the matter told Reuters. The company will raise more than $15 billion in Silicon Valley's largest market debut.
Facebook had originally intended to sell about 337.4 million shares. At a mid-point of $36, the company would raise $15.2 billion in one of the largest U.S. initial public offerings ever.
On Monday, Facebook hiked its price range to $34 to $38 a share, from $28 to $35 previously. Facebook has raised the price range in response to strong demand, a source familiar with the situation had said, giving the No.1 social network a valuation exceeding $100 billion.
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 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.
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