Facebook’s IPO expected in May might be delayed until June amid a number of acquisitions the technology giant is undertaking. Following the news, the social media index for Facebook has dipped considerably.
According to a report by MSNBC, before the news came out, Global X Social Media Index SOCL, was trading at $15.16, but after the news had come out, it went down by 9 basis points. Since SOCL first debuted in November last year, its assets under management have gradually moved up prior to the Facebook IPO. The average daily volume numbers along with the SOCL surged as soon as the markets received the news of Facebook IPO earlier this year. The latest announcement of the delay could cause a problem for the SOCL, since EFT was expected to be the first to welcome Facebook.
Earlier this year, Global X CEO Bruno Del Ama predicted Facebook to become a SOCL constituent within its first five trading days. "At a $75 billion to $100 billion valuation with a free float of 5% to 10%, Facebook would immediately be among the largest holdings in the ETF," Del Ama said in an interview in February, according to a report on Market Watch.
Since its filing with the Securities and Exchange Commission in February, Facebook has been seeking to raise as much as $10 billion at a $100 billion valuation when it goes public in June this year - which will be the biggest ever internet IPO, even surpassing that of Google’s. Its shares will be listed with the NASDAQ under the symbol of FB.
Facebook founderis, at the moment, busy with making acquisitions and running the business - which has temporarily shifted his focus from the sale of shares and other IPO preparations. Facebook is therefore considering “Plan A, B, C and D” for its IPO, tells a source.
Those who are disappointed by the news should understand that it's good that Zuckerberg is focusing more on running the business successfully rather than investors or the stock prices for that matter, since that is what will benefit the future investors in the long run.
However, its $1 billion Instagram acquisition along with a $550 million patent portfolio from Microsoft call for further disclosure with the SEC.