InfoAnda - Regulators, investors turn up heat over Facebook IPO |

Pakistanis angry over detentions in Times Sq. case
Monday, May 24, 2010
ISLAMABAD – Relatives of three men detained by Pakistan for alleged links to the suspect in the attempted Times Square bombing say the men are innocent.
They

Taiwan denies boycotting Australian film festival
Thursday, August 6, 2009

AFP - Thursday, August 6TAIPEI (AFP) - - Taiwan's Beijing-friendly government on Wednesday denied boycotting an Australian film festival amid a row over the e

Merkel's support dips, regional ally resigns International
Thursday, September 3, 2009

By Sarah Marsh and Noah Barkin

BERLIN (Reuters) - Chancellor Angela Merkel suffered a double blow on Thursday as a senior party ally in east German

Minister seeks closure of anti-Berlusconi websites
Wednesday, December 16, 2009
ROME (AFP) - – The Italian government moved Tuesday to close down Internet sites encouraging further violence against Prime Minister Silvio Berlusconi, who

Asian markets mixed after Wall Street rally
Wednesday, March 18, 2009

By ELAINE KURTENBACH,AP Business Writer AP - Wednesday, March 18SHANGHAI - Asia's stock market rally seemed to be running out of steam Wednesday, despite an

Teen sentenced to 30 years in Florida gang rape | 15 December 2009
Charge For Michael Jackson's Memorial Service Dropped | 4 July 2009
One dead, two missing in Malaysia bridge collapse | International | | 27 October 2009

Pentagon makes it harder to expel gays in military | 26 March 2010

Forum Views () Forum Replies ()

Read more with google mobile : Regulators, investors turn up heat over Facebook IPO |

Edition: U.S. Africa Arabic Argentina Brazil Canada China France Germany India Italy Japan Latin America Mexico Russia Spain United Kingdom Home Business Business Home Economy Technology Media Small Business Legal Deals Earnings Social Pulse Business Video The Freeland File Markets Markets Home U.S. Markets European Markets Asian Markets Global Market Data Indices M&A Stocks Bonds Currencies Commodities Futures Funds peHUB World World Home U.S. Brazil China Euro Zone Japan Mexico Russia India Insight World Video Reuters Investigates Decoder Politics Politics Home Election 2012 Issues 2012 Candidates 2012 Tales from the Trail Political Punchlines Supreme Court Politics Video Tech Technology Home MediaFile Science Tech Video Tech Tonic Social Pulse Opinion Opinion Home Chrystia Freeland John Lloyd Felix Salmon Jack Shafer David Rohde Bernd Debusmann Nader Mousavizadeh Lucy P. Marcus David Cay Johnston Bethany McLean Edward Hadas Hugo Dixon Ian Bremmer Lawrence Summers Susan Glasser The Great Debate Steven Brill Jack & Suzy Welch Frederick Kempe Christopher Papagianis Breakingviews Equities Credit Private Equity M&A Macro & Markets Politics Breakingviews Video Money Money Home Tax Break Lipper Awards 2012 Global Investing MuniLand Unstructured Finance Linda Stern Mark Miller John Wasik James Saft Analyst Research Alerts Watchlist Portfolio Stock Screener Fund Screener Personal Finance Video Money Clip Investing 201 Life Health Sports Arts Faithworld Business Traveler Entertainment Oddly Enough Lifestyle Video Pictures Pictures Home Reuters Photographers Full Focus Video Reuters TV Reuters News Article Comments (13) Slideshow Video Counterparties: Today's Best Links How the iPad saved Greece billions When Greece faced a tense, massive debt restructuring earlier this year, an entrepreneur used iPads to connect 100,000 bondholders, saving billions. Read more at Counterparties JPMorgan's rivals cashed in on bank's bad bet Congress speaks at a 10th grade level Sign up for the Counterparties newsletter! Follow Reuters Facebook Twitter RSS YouTube Read Wall Street struggles to find Facebook's worth 22 May 2012 SEC, FINRA to review Facebook issues, Nasdaq sued | 22 May 2012 Investors sue Nasdaq, Facebook over IPO 22 May 2012 Exclusive: Massachusetts subpoenas Morgan Stanley for Facebook 22 May 2012 Facebook advised analysts to cut forecasts before float 1:43am EDT Discussed 173 Iran attack decision nears, Israeli elite locks down 148 Exclusive: U.S. lets China bypass Wall Street for Treasury orders 118 Obama presses ailing Europe to focus on growth Watched Famous "spike through brain" case yields new insights for scientists Tue, May 22 2012 A look at the UK’s most beautiful face Thu, May 10 2012 Apple plans fatter iPhone 5 to choke market-hungry Samsung Thu, May 17 2012 Wealth and Investing Center Pictures Reuters Photojournalism Our day's top images, in-depth photo essays and offbeat slices of life. See the best of Reuters photography. See more | Photo caption Olympic torch relay A look at the relay for the Olympic torch as it makes its way from Greece to England. Slideshow SpaceX lifts off A privately owned unmanned rocket blasted off on a mission to be the first commercial flight to the International Space Station. Slideshow Regulators, investors turn up heat over Facebook IPO Tweet Share this Email Print Related News The numbers on the Facebook earnings revisions 12:54am EDT Funds with Facebook hammered as proxy by shorts 12:54am EDT Nasdaq shareholders mum on Facebook IPO 12:54am EDT Exclusive: Massachusetts subpoenas Morgan Stanley for Facebook 12:54am EDT Analysis & Opinion Counterparties: JPMorgan’s giant search for yield The Facebook earnings-forecast scandal Related Topics Tech » Deals » Global Deals Review: 2011 Q3 » Global Deals Review: 2011 Q2 » Global Deals Review » Hot Stocks » Asian Markets » Money » Inflows Outflows » Media » Facebook » Regulatory News » Related Video Morgan Stanley's Facebook about-face Tue, May 22 2012 1 of 2. The Facebook logo is seen on a screen inside at the Nasdaq Marketsite in New York in this May 18, 2012, file photo. Credit: Reuters/Shannon Stapleton/Files By Suzanne Barlyn and Ryan Vlastelica Wed May 23, 2012 4:03am EDT (Reuters) - Two top U.S. financial regulators said on Tuesday the issues around the initial public offering of Facebook should be reviewed, putting fresh pressure on the company, its lead underwriter, Morgan Stanley, and the Nasdaq stock exchange. Facebook shares closed 8.9 percent lower at $31, following an 11 percent plunge on Monday. At that price the company has shed more than $19 billion in market capitalization from its $38-per-share offering price last week. Reuters reported late Monday that the consumer Internet analyst at lead underwriter Morgan Stanley cut his revenue forecasts for Facebook in the days before the offering, information that was not disclosed to the market before the stock was listed. Facebook itself had urged analysts working for some of the 33 underwriters to lower their estimates ahead of the IPO, according to four sources with direct knowledge of the conversations that were held during the week prior to the IPO. "Facebook changed the numbers. They didn't forecast their business right and they changed their numbers and told analysts," said another source at one of the underwriters with knowledge of the situation The company had issued a revised prospectus on May 9 in which it cautioned about the possible negative impact of Facebook users shifting to mobile platforms, but the vague language fell well short of an explicit warning of lower revenues or earnings. Facebook has yet to make much revenue from mobile advertising. The disclosure of lower forecasts to certain big institutional investors left both Facebook and Morgan Stanley open to accusations of selective disclosure. Many smaller investors who bought Facebook shares in the IPO were left in the dark. A Facebook spokesman declined to comment. "Morgan Stanley followed the same procedures for the Facebook offering that it follows for all IPOs," Morgan Stanley spokesman Pen Pendleton said in a statement. "These procedures are in compliance with all applicable regulations." JPMorgan Chase and Goldman Sachs, which were also lead underwriters on the deal, and another underwriter, Bank of America Merrill Lynch, also all revised their estimates during Facebook's IPO roadshow, according to sources familiar with the situation. The new estimates showed reductions in revenue and earnings projections for both the second quarter of 2012 and the full year, according to detailed figures reviewed by Reuters. The issue of selective disclosure drew the attention of the main regulator of U.S. brokerages. "That's a matter of regulatory concern to us and I'm sure to the SEC," said Richard Ketchum, the Financial Industry Regulatory Authority's chairman and chief executive. "And without saying whether it's us or the SEC, we will collectively be focusing on it. Securities and Exchange Commission Chairman Mary Schapiro said investors should be confident in investing, but she conceded there were questions to answer as well. "I think there is a lot of reason to have confidence in our markets and in the integrity of how they operate, but there are issues that we need to look at specifically with respect to Facebook," she told reporters as she exited a Senate Banking Committee hearing. The state of Massachusetts also said it would examine the issues. Secretary of Commonwealth William Galvin issued a subpoena to Morgan Stanley in connection with its analyst's discussions with investors about Facebook. A Los Angeles law firm filed a lawsuit seeking class action status against Facebook and its underwriters alleging inadequate disclosure of key information. The legal issues surrounding the disclosure obligations of a pre-public company and its underwriters are murky, securities lawyers said. Public companies are subject to a rule known as Regulation Fair Disclosure, which requires that material information be disclosed to all investors at the same time. But that rule would not apply to information that Facebook provided to its underwriters before it went public, according to securities law experts. Underwriters also may not have a legal obligation to disclose their proprietary research to all clients at the same time. Adam Pritchard, a securities law professor at the University of Michigan and a former SEC enforcement attorney, said that in general, information disseminated pre-IPO cannot be inconsistent with what is provided in the prospectus. But Pritchard added that there is a big exception to these so-called "gun-jumping rules" for oral communications. Facebook's guidance to analysts, and the subsequent revised estimates communicated to some investors, were delivered in telephone calls and conference calls rather than emails or written reports, the sources said. The conversations took place shortly after Facebook filed its revised prospectus. The legal subtleties, though, did little to ease the anger of some investors and brokers who say the Facebook IPO now stands as an ugly example of a system rigged against the little guy. "Night and day the institutional clients get things that we don't get," said a Morgan Stanley Smith Barney adviser who works with retail clients. "It's a huge issue for the entire industry." STILL OVERVALUED? With the stock falling on Tuesday, a debate continued over what the social networking company is really worth. Even with the company valued at about $85 billion at the market close Tuesday, compared with $104 billion at its IPO price, some experts say it is overvalued. Thomson Reuters Starmine conservatively estimates a 10.8 percent annual growth rate - almost exactly the mean for the technology sector. On that basis, Starmine says the stock could be valued at $9.59 a share, a 72 percent discount to its IPO price. Similarly, the company's price-to-earnings ratio remains lofty, even after the selloff. The $31 price implies a P/E of 60 for expected 2012 results, compared with Google's 13.3 for a similar rate of growth. With Facebook shares not yet available for borrowing and thus all but impossible to sell short, bearish investors have sought out almost any related vehicle to bet against Facebook. Over the past three trading days, prices plunged on two closed-end funds that owned pre-IPO shares. Firsthand Technology Value Fund and GSV Capital Corp both dropped more than 25 percent even though their Facebook holdings make up only a small fraction of assets. "Until investors can actually short Facebook, they have to keep shorting other things that can give them some sort of proxy for Facebook," said Thomas Vandeventer, manager of the Tocqueville Opportunity Fund, which owns shares of both the battered closed-end funds. Brokers who over-ordered shares in the expectation that supply would be limited continued to complain they received too much stock to handle and were left in the dark about forecast changes. Some big investors, though, protected themselves well. In a securities filing on Tuesday, Microsoft disclosed that it had sold 6.5 million shares at $37.58, meaning the software giant covered the cost of its original investment of 32.8 million shares for just $240 million in 2007, while still retaining most of the stake. WEIGHING ON NASDAQ Besides the pressure on Facebook and on Morgan Stanley, there is also an intense focus on Nasdaq OMX Group Inc, which has shouldered much of the blame for the trading failures that market participants believe contributed to the weak performance of Facebook shares on its debut on Friday. A technical glitch delayed Facebook's market debut by roughly half an hour, and later delayed order confirmations. The exchange has set aside money to compensate customers, but some on Wall Street are warning its ability to snag future big IPOs is at risk. Meanwhile, a suit filed late Tuesday in Manhattan federal court seeks class-action status for anyone who lost money due to Nasdaq mishandling an order. "It's dreadful for the markets," former SEC Chairman Arthur Levitt said of the IPO and its handling by banks and Nasdaq. "It's an event with long-lasting negative implications for an industry that can ill afford this kind of blemish, and the last chapter hasn't been written. Nobody looks good here." But Nasdaq shareholders gave the company a pass on Tuesday. At the exchange operator's annual meeting, which only lasted a few minutes, top executives did not get any questions about what went wrong with Facebook or what they were doing to correct it. "While clearly we had mistakes in the Facebook listing, we still want to highlight the fact that it was the largest IPO ever and on Friday of last week, we processed over 570 million shares," Nasdaq Chief Executive Bob Greifeld said at the shareholder meeting. (Additional reporting by Jed Horowitz, Edward Krudy, David Gaffen, Jessica Toonkel, Joe Giannone, Jonathan Spicer, Olivia Oran and John McCrank in New York, Ross Kerber in Boston, Sarah N. Lynch in Washington and Alistair Barr, Alexei Oreskovic, Poornima Gupta and Noel Randewich in San Francisco; Writing by Ben Berkowitz in Boston; Editing by Jonathan Weber, Edward Tobin, Maureen Bavdek, Steve Orlofsky, Robert Birsel) Tech Deals Global Deals Review: 2011 Q3 Global Deals Review: 2011 Q2 Global Deals Review Hot Stocks Asian Markets Money Inflows Outflows Media Facebook Regulatory News Related Quotes and News Company Price Related News Tweet this Link this Share this Digg this Email Reprints We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see http://blogs.reuters.com/fulldisclosure/2010/09/27/toward-a-more-thoughtful-conversation-on-stories/ Comments (13) Tiu wrote: Edition: U.S. Africa Arabic Argentina Brazil Canada China France Germany India Italy Japan Latin America Mexico Russia Spain United Kingdom Back to top Reuters.com Business Markets World Politics Technology Opinion Money Pictures Videos Site Index Legal Bankruptcy Law California Legal New York Legal Securities Law Support & Contact Support Corrections Connect with Reuters Twitter Facebook LinkedIn RSS Podcast Newsletters Mobile About Privacy Policy Terms of Use AdChoices Copyright Our Flagship financial information platform incorporating Reuters Insider An ultra-low latency infrastructure for electronic trading and data distribution A connected approach to governance, risk and compliance Our next generation legal research platform Our global tax workstation Thomsonreuters.com About Thomson Reuters Investor Relations Careers Contact Us Thomson Reuters is the world's largest international multimedia news agency, providing investing news, world news, business news, technology news, headline news, small business news, news alerts, personal finance, stock market, and mutual funds information available on Reuters.com, video, mobile, and interactive television platforms. Thomson Reuters journalists are subject to an Editorial Handbook which requires fair presentation and disclosure of relevant interests. NYSE and AMEX quotes delayed by at least 20 minutes. Nasdaq delayed by at least 15 minutes. For a complete list of exchanges and delays, please click here.

Other News on Wednesday, 23 May 2012
North Korea to boost nuclear deterrent after U.S. pressure |
Small bomb found in Argentina ahead of Uribe visit |
South Sudan says Sudan bombs, Shells its territory |
Putin energy tsar named CEO of Russia's Rosneft |
Mali coup leader condemns president beating |
Dell results disappoint Street, shares dive |
SAP to buy software maker Ariba for $45 per share |
Kleiner partner sues firm for discrimination |
Exclusive: Spy agency seeks cyber-ops curriculum |
CBS declares TV victory, Idol still most-watched |
Kilts and whisky hit Cannes screens in Ken Loach film |
Comic book X-Men plan same-sex superhero wedding |
Michael Jackson is still Bad, 25 years after album |
Bristol Palin returns to TV spotlight in June |
Cannes film festival abuzz as dark tales shine |
Hollande set for EU summit showdown with Merkel |
Egyptians vote to pick president for first time |
As Myanmar opens, protesters test boundaries |
IAEA chief says nears deal with Iran ahead of 6-power talks |
Syrian opposition urges release of abducted Lebanese |
Shadowy China X-Men stoke social strains: report |
Afghans back Chicago deal, warn West to keep promises |
Turkmenistan signs deal on trans-Afghan gas pipeline |
Mexico leftist moves into second in presidential poll |
Opposition candidate concedes defeat in Dominican election |
SAP to buy Ariba, boosts cloud bet |
Japan's NTT Docomo applies for 700 MHz license |
Regulators, investors turn up heat over Facebook IPO |
Glee graduates face tears, fears, uncertain futures |
Brad Pitt mob movie portrays broken American dream |
Donald Driver Cha-cha-chas to Dancing win |
Power ballad Sanchez vs. genius Phillips on Idol |
Johnny Depp made honorary member of Comanche Nation |
White House said to give inside access for bin Laden film |
Dylan, Albright to receive Presidential Medal of Freedom |
Exclusive: Eurozone tells members to make contingency plans for Grexit |
Pakistani doctor jailed for helping CIA find bin Laden |
Strauss-Kahn asks French court to lift gag order |
Mali leader to head to France for health checks: sources |
Three Lebanese pilgrims killed in Iraq bombing |
Italy's President warns of return of 1970s-style violence |
U.S. hopes for breakthrough in Pakistan NATO supply route talks |
Facebook, banks sued over pre-IPO analyst calls |
Yahoo under Levinsohn seen shifting to content, advertising |
Obama orders agencies to shift services to mobile application |
Kerouac's On the Road hits screen in Cannes debut |
Holy Motors! Minogue, Mendes in madcap Cannes movie |
A Minute With: Barry Sonnenfeld about Men in Black 3 |
Greece at new risk of being pushed off euro
Bodies of missing Tenn. mom, Jo Ann Bain, and daughter found
Female Breasts Are Bigger Than Ever
AMD Trinity Accelerated Processing Units Now in Volume Production
The Avengers (2012 film), made the second biggest opening- and single-day gross of all-time
AMD to Start Production of piledriver
Ivy Bridge Quad-Core, Four-Thread Desktop CPUs
Islamists Protest Lady Gaga's Concert in Indonesia
Japan Successfully Broadcasts an 8K Signal Over the Air
ECB boosts loans to 1 trillion Euro to stop credit crunch
Egypt : Mohammed Morsi won with 52 percent
What do you call 100,000 Frenchmen with their hands up
AMD Launches AMD Embedded R-Series APU Platform
Fed Should not Ignore Emerging Market Crisis
Fed casts shadow over India, emerging markets
Why are Chinese tourists so rude? A few insights

USD EUR - 1 year graph	VPN on MacOSX	BlogMeter 1.01