With its impending road show in May, Facebook is enduring some delays and distractions that may be push back its high-anticipated IPO to June.
In a CNBC story, it notes that recent acquisitions and distractions may be driving a delay. Facebook management had been looking at a May offering with a possible roadshow for investors to begin on May 7. Public trading in the stock was to begin the following week but now sources are saying not so fast.
One of the culprits for the delay is Facebook founder and CEO Mark Zuckerberg. Allegedly the 20-something entrepreneur has been more concerned about running his business and making acquisitions (see Instagram and Microsoft patents) than preparing for the IPO.
A possible new timeline, according to CNBC, is pushing back the roadshow to May 14 or at month’s end. This would likely have an early or mid-June start date for trading thanks to the Memorial Day holiday slowing things down.
This is one option and allegedly Facebook is reviewing a few of them for timing.
A Facebook spokesman has not commented on it.
So how does this affect potential investors? It may concern them that management is a problem. How will they run their company publicly if Zuckerberg is so hands-on and distracted to really hunker down and the change to a public company? How will he deal with investors?
One recent IPO that was slow getting out of the starting gates is the 2011 Groupon IPO. The company moved back their IPO last fall, saying it was due to market volatility but it was also undergoing some accounting problems. The move raised eyebrows not only about the Groupon but also its CEO, Andrew Mason.
The company’s November IPO was initially deemed a success, raising $700 million; this gave them the distinction as the largest IPO by a U.S. Internet company last seen since Google Inc (NASDAQ:GOOG) 2004 $1.7 billion.
Accounting problems continue to plague the company and it is currently under review by the Securities and Exchange Commission.
Facebook faces a different set of potential problems: its management. The company is expected to raise between $75 billion and $100 billion, steamrolling over Google’s Inc (NASDAQ:GOOG) numbers. But once the company climbs this mountain, is this just the tip of the iceberg for more delays and dragged feet?