Facebook Stock Plunges Nearly 50% From IPO
Facebook's stock plunged to a new low Thursday after the expiration of a ban that had prevented some early investors and insiders from dumping millions of additional shares they own in the social-networking leader.
Firms ranging from Accel Partners to Goldman Sachs, Zynga CEO Mark Pincus and Facebook board members James Breyer, Peter Thiel and Reid Hoffman were among those free to sell stock they own, after the lifting of a ban known as a lock-up period.
If many of them took advantage of that, Facebook's stock could decline because the market would be flooded with nearly two-thirds more shares.
It's not yet known whether any of those investors had sold any shares. The stock price decline could have reflected investors' anticipation of such a move.
Facebook Inc.'s stock traded as low as $19.69 before bouncing back to $19.91 in midday trading Thursday. That's still 6 per cent down, or $1.29, from Wednesday's close and about 48 per cent below its initial public offering price of $38. If the stock hits $19, it will have lost half its value since Facebook went public in May.
It's been a rough run for Facebook. After one of the most-anticipated IPOs in history, Facebook suffered what may be the most-botched public offering as trading glitches marred its first day.
(The Canadian Press)