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article imageFacebook rumored to file IPO paperwork with SEC next week

By Leigh Goessl     Jan 27, 2012 in Business
Palo Alto - Rumors over a Facebook initial public offering have been emerging across the Internet and in financial circles for some time now.
In recent months talk and speculation has been aimed towards Facebook's IPO coming sooner than later.
Recently Digital Journal reported the social network giant's IPO was speculated to come in May, meaning a filing is in the near future. Now reports are surfacing the company may file their IPO paperwork with the U.S. Securities and Exchange Commission (SEC) next week.
According to the Wall Street Journal, Facebook Inc. is preparing to file the required papers, and the social media giant is "close to picking Morgan Stanley" as the primary underwriter for its IPO. Goldman Sachs is said will play a role as well, but may not get the lead.
Wednesday was the filing day given to the WSJ by an unnamed person "familiar with the matter," however, reportedly executives are also considering holding off a few weeks to file.
Allegedly, Facebook is looking to raise approximately $10 billion once it goes public.
Early on in 2011 Facebook's valuation was estimated to be about $50 billion, but by the end of the year financial experts were pointing towards a figure around $100 billion. Currently the magic number appears to be between $75 and $100 billion, and what the final valuation is will depend upon external factors such as IPO market, health of the European economy and investor demand for social media, said WSJ.
Internet companies going public are a hot topic at the moment, however may be considered risky. LinkedIn's IPO was highly successful, however Groupon, while an exciting start, soon floundered and has since been up and down.
All eyes are on Facebook as this IPO is looked upon as being not only the biggest of all Internet IPOs, but in general. The company's debut is looking far larger that Google, which fell under the $2 billion mark.
The San Jose Mercury reported several other social media stocks jumped up after the news broke about Facebook initiating its IPO next week.
An example of the new Timeline profile on Facebook
An example of the new Timeline profile on Facebook
Facebook
As customary, CEO Mark Zuckerberg and Facebook are mum about what the company's intentions are where its IPO is concerned. Mashable reported Facebook had halted trading in secondary markets for three days, hinting towards IPO.
Mashable also pointed to the fact Facebook is actively getting its new products in place, including the most prominent, Timeline, along with 60 apps entwined with the mass rollout.
According to SEC protocol, once Facebook files for IPO, it must cease making public announcements as the SEC reviews the paperwork, up until the point the registration statement is declared "effective." This includes new product announcements, which might explain the rapid movement of getting these product pieces in place if indeed it is Facebook's intention to file next week.
Once Facebook goes public, it has been speculated thousands of people connected to Facebook will become millionaires.
More about facebook IPO, Facebook, initial public offering, Ipo, Sec
 
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