Facebook putting off its IPO until late 2012?
The world's largest social network might wait until late next year to go public so employees keep their focus on product development, according to a new report.
Facebook is once again delaying its initial public offering, according to a new report.
Citing "people familiar with the company," the Financial Times reported today that the world's largest social network won't offer its shares on the open market until "late 2012." The sources didn't say exactly when the company might go public, but they did say that they expect Facebook to wait until next September, at the very earliest.
According to the Financial Times' sources, Facebook wants to delay the IPO to ensure employees are dedicated to improving the company's line of products, rather than worrying about cashing in their shares.
That said, it might also have something to do with the state of the stock market. With the financial crisis in Europe continuing to worsen, and economic and political issues in the United States worrying investors, the markets have swung wildly as of late. Such volatility is making some companies wonder if it might be the wrong time to initiate an IPO.
Related stories:
• Facebook planning IPO on $100 billion valuation?
• Facebook's IPO stalling: Are we even still surprised?
• Facebook changes stock structure: IPO on the way?
Earlier this month, Groupon, which filed for an IPO in June, reportedly decided to delay its public offering until the market rebounds. The Wall Street Journal, citing sources, said that the market's "volatility" has been enough for the company to balk at offering its shares. That report followed a similar rumor claiming social-gaming company Zynga was also planning to delay its IPO.
Neither company has commented on when they will go public.
But unlike those firms, Facebook hasn't made any indication that it will, in fact, go public, even though reports of such a move have been cropping up for years. In 2007, whispers of a Facebook IPO first started making their rounds. Those whispers grew louder in 2009 when Facebook changed its stock structure to a dual-class system. The move, which is quite typical prior to an IPO, prompted some to wonder if the social network would finally go public in 2010. But once again, Facebook balked at the idea.
If and when Facebook goes public, it will be a blockbuster event on Wall Street. Though the Financial Times' sources don't agree, earlier this year, CNBC reported that Facebook would go public in the first quarter of 2012. According to CNBC's sources, Facebook would offer its shares based on a valuation of $100 billion. To put that figure into perspective, when Groupon announced its IPO, reports claimed that the daily-deals provider planned to raise $750 million on a valuation of between $20 billion and $25 billion.
Facebook did not immediately respond to CNET's request for comment on the Financial Times report.