By Zijing Wu - Feb 3, 2012 1:17 AM GMT+0700
The odds are pointing to Facebook Inc. pricing its IPO at between $35 and $44.99 a share in the $5 billion initial public offering it filed for yesterday, according to the Irish bookmaker Paddy Power Plc. (PAP)
Facebook, based in Menlo Park, California, will price the new shares within that range at odds of 10 to 11, according to an e-mailed statement from Paddy Power. The likelihood of the social-networking website selling shares as low as $25 stands at 7 to 2, and at 9 to 2 for prices of more than $65, the gambling company site said.
“With Facebook now a part of most of our day-to-day lives, the IPO was always going to get people talking,” Feilim Mac An Iomaire, a spokesman for Dublin-based Paddy Power, said in the statement. “The odds would suggest that the price will fall between $35 and $44.99, but given Facebook’s history of exceeding expectations, I don’t think we can rule anything out.”
Paddy Power customers are also betting on who will ring the opening bell for Facebook in its debut. While Chief Executive Officer Mark Zuckerberg leads with odds of 1 to 100, betters are also wagering on Facebook’s former president Sean Parker (25 to 1), Microsoft (MSFT) Corp.’s co-founder Bill Gates (50 to 1) and the Irish rock band U2’s lead singer Bono (100 to 1) as candidates.
Bono is a co-founder and managing director of Elevation Partners LP, an investor in Facebook. Microsoft put $240 million into Facebook in 2007. Odds of 100 to 1 mean a gambler betting 1 euro would win 100 euros and their stake back.
Meteoric Rise
Facebook, whose meteoric rise spawned an Oscar-winning film and captivated Wall Street, yesterday named Morgan Stanley (MS) as the lead underwriter on its IPO, while reporting a 24-fold increase in sales over the past four years to $3.71 billion in 2011.
Co-founded in 2004 by Mark Zuckerberg, now 27, Facebook has grown into the world’s dominant social-networking site, squelching competitors such as MySpace Inc. with its more than 800 million users. While Facebook’s sales almost doubled last year, the company faces increasing competition from rivals such as Google Inc., which debuted its own social-networking service last year, and from the microblogging site Twitter Inc., the filing shows.
To contact the reporter on this story: Zijing Wu in London at zwu17@bloomberg.net
To contact the editor responsible for this story: Jacqueline Simmons at jackiem@bloomberg.net
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