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Replies to post #95104 on Protagenic Therapeutics Inc. (PTIX)
05/03/12 12:48 AM
05/04/12 1:05 AM
Facebook, which plans to make a market debut this month that could value it at $86 billion, is the stock that everyone seems to want.
If you are a small investor, lots of luck. Typically, shares of the hottest initial public offerings go almost entirely to the biggest clients of the Wall Street banks that oversee the stock sale. And no I.P.O. is as big or as eagerly awaited this year as Facebook’s.
Yet there may be a sliver of hope. Facebook’s executives and underwriters have discussed raising the number of shares that will go to retail investors, say people briefed on the matter who were not authorized to speak on the record. It is not known how much will eventually go to these mom-and-pop investors, but Wall Street executives estimate that the retail share could be as much as 20 to 25 percent of the offering.
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Facebook executives will meet in New York with the sales forces of its banks on Friday to brief them on the I.P.O. presentation, according to one of the people with knowledge of the matter.
The company is seeking to give retail investors a bigger cut because it sees itself as a service created for, and driven by, consumers. One person briefed on the offering, who declined to be identified because of regulatory restrictions, said Facebook sees itself as “the people’s company.”
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How those shares are allotted is part of a choreographed series of events that takes place over several months before the market debut. A regulatory filing that describes the company’s business to investors starts the process. The company also selects a team of underwriters.
In the case of Facebook, the social networking giant tapped Morgan Stanley to lead the public offering, followed by JPMorgan Chase and Goldman Sachs.
In what is known as a road show, these underwriters take the company’s executives out to meet big institutional investors, who take the opportunity to quiz company executives. Demand to attend the Facebook presentations has been extraordinarily high, with underwriters already drawing up waiting lists for the meetings, according to two people briefed on the matter.
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One Wall Street broker, who declined to be named, citing his firm’s policy against speaking to the media, said that financial advisers who specialize in initial public offerings will also be at the top of the list of brokers getting a Facebook allocation.
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In the case of an Internet I.P.O., he said: “Branch managers should also look at whether the account holds high-growth technology stocks and is accustomed to that type of investment.”
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