Facebook IPO timetable: It's in the SEC's hands

Mark Zuckerberg's big-spending ways have slowed the process, but Facebook's bankers are hoping for the SEC's blessing this week.

Paul Sloan Former Editor
Paul Sloan is editor in chief of CNET News. Before joining CNET, he had been a San Francisco-based correspondent for Fortune magazine, an editor at large for Business 2.0 magazine, and a senior producer for CNN. When his fingers aren't on a keyboard, they're usually on a guitar. Email him here.
Paul Sloan
2 min read
Mark Zuckerberg at F8 in 2010
Mark Zuckerberg at F8 in 2010 James Martin/CNET

Here's the latest on the much-watched timetable for Facebook's IPO, likely to be the biggest Internet IPO in history: The road show could begin next week, which would pave the way for trading to begin May 17 or 18.

It's a "could" because the Securities and Exchange Commission still needs to sign off on Facebook's S-1 filing, and that process has been stalled because a certain 27-year-old CEO has been busy the past few weeks with items that amount to material changes to Facebook's finances. Namely, he single-handedly struck a deal to buy Instagram for $1 billion in cash and stock, and then he shelled out $550 million to buy a trove of patents from Microsoft just weeks after the gang in Redmond, Wash., bought them from AOL.

These are the sorts of actions -- spending $850 million of Facebook's $3.9 billion in cash and cash equivalents -- that send a company's S-1 back to the examiners' desk at the the SEC.

All this led to speculation that the IPO date would get pushed back to June. But Facebook's bankers, lead by Morgan Stanley, are hoping that's not the case. Kara Swisher at AllThingsD this morning reported that things could be on track for a mid-May offering, a date that was already pushed back from an original April target.

Sam Hamadeh, who runs a firm called PrivCo that digs into private company data, tells me that the underwriters are hoping to receive clearance from the SEC by Thursday, or possibly early Friday. That would have to happen for the road show to begin on Monday next week.

Hamadeh says the underwriters have a Plan B and even a Plan C. Plan B has the road show beginning the week of June 4, after the Memorial Day holiday with the IPO in mid-June. And Plan C, says Hamadeh, waits the summer out entirely and has the road show starting after Labor Day, with the IPO the third week of September.

The appeal -- and risk -- of pushing out the IPO that long is that it would give Facebook an opportunity to report another quarter of financial results. Facebook's first quarter, which it reported last week, was weak. Revenue fell 6 percent to $1.06 billion compared with the year-earlier quarter; profit was off 12 percent to $205 million.

For all the excitement about the IPO, the much-speculated $100 billion valuation could prove tough to reach given that growth is slowing.