Here’s a peek at what Facebook initial public offer (IPO) mania is doing to Silicon Valley: JP Morgan is planning to open 650 new locations this year to provide financial planning services targeting people with $0.25-5 million. Most of these will come up around Silicon Valley in California. Realty prices are also booming, with more and more people ready to seal property deals by paying in full cash. Even car dealers are gearing up to sell not just top-of-the-range luxury cars but vintage, exotic cars.
It’s a fact that Facebook’s IPO, which could possibly total $16 billion, will create several millionaires and a bunch of billionaires practically overnigth. The social networking website’s shares are all set to be listed on Nasdaq in the US on 18 May (Friday).
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It is by far the biggest events to rock the Internet IPO arena in recent years, surpassing previous record-holder Google.
Taking Facebook’s mammoth IPO into account, here are the Internet world’s top 10 IPOs.
1. Facebook: With an IPO worth $5 billion, the social media website has been valued at a staggering $100 billion. It shares are most likely to be priced at $34-38, although a final IPO price is yet to be fixed. Most brokers have “closed their books” due to high demand and the price could rise beyond the fixed band, according to several commentators in the US. The ordinary public will, however, get to own a slice of the Facebook cake when its shares are listed on Friday.
2. Google: Google, the biggest search engine globally is no Facebook. But as some people would point out, Facebook is no Google either. In the summer of 2004, with memories of the dot-com bust still fresh in the minds of many scarred investors, the mood among big-moneyed institutional investors for tech stocks was downright hostile. Regardless, Google successfully completed its $1.67 billion IPO, which valued the company at a respectable $23 billion. The initial hostility from big money also evaporated as the stock’s value tripled in the first year itself.
3. Alibaba.com: One of the largest e-commerce companies in China, Alibaba listed on the Hong Kong stock exchange raising $1.5 billion in October 2007. The public offer valued the company at $7.8 billion. However, the journey for the Chinese giant has not been smooth as regulators kept hauling up the company for alleged fraud, forcing CEODavid Wei to quit.
4. Yandex: Yandex, owner of Russia’s most popular Internet search engine, listed in May last year raising $1.3 billion in an initial public offering that sold above the proposed price range.The stock jumped 55 percent on the Nasdaq on the day of listing. However, the stock is trading 13 percent below the offer price currently.
5. Shanda Games: Shanda Games, a Chinese operator of online video games, raised $1 billion in the richest US stock market debut in 2009. Unfortunately for investors, on the first day itself, the stock fell 10 percent. Currently, the stock is almost 63 percent below the offer price.
6. Zynga: Zynga, which creates online games like Farmville, was the most talked about IPO last year. But when Zynga finally went public last month, its stock price dropped 5 percent on the first day of trading and has since consistently traded below its $10 offering price. It raised $1 billion through its IPO, which valued the company at $8 billion.
7. Giant: Giant Interactive Group, the third-largest developer and operator of online games in China, listed in 2007 raising $887 million on the New York Stock Exchange. While the shares surged by18 percent on opening day, they have crashed almost 75 percent since listing.
8. Renren: Renren, one of the biggest social networking websites, listed last year providing almost the perfect curtain raiser for the Facebook IPO. Renren raised $743.4 million in its IPO. The stock rose 56 percent above offer price on the first day and closed 29 percent above the offer price. But the initial euphoria didn’t last and the stock is now trading at half its listing price.
9. Groupon: This largest daily coupon website is far from being an ideal example for an IPO. Groupon raise $700 million in its IPO, which valued the company at $10.5 billion. But scrutiny increased on the accounting methods of the company. The stock has dropped 51 percent since its initial public offering in November and is now valued at just above $6 billion.
10. LinkedIn: The professional social networking company, which began in one man’s living room less than a decade ago, debuted on the New York Stock Exchange in May last year. The company raised $353 million, valuing the company at $4 billion. The stock rose 171 percent in their first day of trade on the NYSE, finally closed at $94.25, more than 10o percent above the $45 public offer price per share. The stock has gained close to 93 percent since then.


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