REPORT: Facebook To Hike Price Range Of IPO

By David Cohen 

Facebook will increase the price range of its May 18 initial public offering Monday or Tuesday, before its order book closes Wednesday, according to Kayla Tausche, reporting on CNBC’s “Squawk on the Street” Friday morning.

The price range Facebook initially announced for next Friday’s IPO was $28 to $35 per share, and if the company seeks to raise that level by more than 20 percent, it must file that request with the Securities and Exchange Commission before Wednesday.

Tausche reported Friday morning:

A lot of myths out there about the demand for Facebook’s IPO, which, I am told by sources, is already many, many times oversubscribed, and that’s just with institutional orders that have come in thus far from the company’s four days on the road. Now this oversubscription is not including what one source called a “standard retail allocation” of around 10 percent to 20 percent.

Now Facebook has a wide $7 range — $28 to $35 per share — that will be updated before the order book closes next Wednesday, I am told. And final decisions on that price range are likely to come Monday or Tuesday, as demand from West Coast investors is assessed.

But that update, I understand, could include raising the current price range, and that’s a move that could come as early as Tuesday. Now, of course, any changes of more than 20 percent of the current range would need to be filed with the SEC before that order book closes Wednesday, so we will keep you updated throughout next week. We will also have a little bit more from Julia Boorstin from Palo Alto. But I should note that sources did caution that pricing and demand remain extremely fluid.

The company continues its cross-country roadshow to gauge that full picture of demand. It could always change, but as of right now, changes next week could include raising that price range.

Readers: Do you think raising the price range of Facebook shares prior to the IPO next Friday would be a wise move by the company?

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