How the Facebook IPO Turned Into Finger-Pointing
Ahhh, the Facebook IPO.
It was supposed to be the IPO of the century … the second coming of the internet … the biggest thing since, well, Facebook.
Instead, last Friday’s IPO, the largest Internet IPO ever, led to a week of hand-wringing, finger-pointing and a lawsuit. The stock ended its first day of trading 23 cents above its offering price. It slid Monday. It slid Tuesday. The same day, the SEC opened an inquiry. Wednesday, a lawsuit was filed, accusing the company of withholding important information from investors. But the shares finally inched up. (Remember? It’s risky to buy stocks during IPOs!)
Want More?Facebook’s IPO: See How the Company Is About to Change
Speaking of scandals, JPMorgan Chase, which has recently attracted the notice of regulators, suspended plans for a share buyback, in which the company would buy shares from investors to decrease the number of publicly available shares. And the trial began for businessman Rajat Gupta, who allegedly leaked secrets to former hedge fund manager Raj Rajaratnam. The latter was sentenced to 11 years in prison, the longest term for a charge of insider trading.
On other shores, European regional leaders failed to come up with new steps to stimulate Europe’s economy or reconcile differences in agenda between new French President François Hollande and German Chancellor Angela Merkel. And China looked to spur its slowing economy with incentives for new energy technologies and targeted tax cuts.
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photo: Sean MacEntee/Flickr