(Reuters) – Facebook Inc has raised the price range on
its initial public offering to $34 to $38 a share in response to strong demand, a source familiar with
the situation said, giving the No.1 social network a valuation exceeding $100 billion.
the Facebook stock after attending a show for Facebook Inc's initial public offering at the Four
Season's Hotel in Boston, Massachusetts May 8, 2012. REUTERS/Jessica Rinaldi
At the mid-point of $36, Facebook would raise $12.1 billion by
selling 337.4 million shares. The company founded in a Harvard dorm room by Mark Zuckerberg, who turned
28 on Monday, had originally aimed for $28 to $35 a share.
Wall Street had expected the company
to increase the price range, with investors keen to get in on Silicon Valley’s largest ever IPO that
eclipses Google Inc’s 2004 debut. Its roadshow began last week and has drawn crowds.
The
company plans to close the books on its IPO on Tuesday, two days ahead of schedule and in a signal that
the landmark initial share sale is drumming up strong demand, a second source familiar with the deal
told Reuters earlier.
The social network is scheduled on Thursday to price its shares, then
begin trading on Friday.
The IPO is already “well oversubscribed,” which is why the company is
closing its books earlier than anticipated, the source said.
The raised price range marks an
increase of 21 percent on the lower end. A hike of more than 20 percent typically means the company
would have to file an amendment with the Securities and Exchange Commission.
Company spokesman
Jonny Thaw declined to comment on Monday.
The IPO comes amid concerns from some investors that
Facebook hasn’t yet figured out a way to make money from an increasing number of users who access the
social network on mobile devices such as smartphones.
Facebook will continue with its roadshow
for the rest of the week, said a third source familiar with the deal, and investors who haven’t yet
attended a roadshow presentation will still be able to place orders.
Company executives met with
prospective investors in Chicago on Monday and are slated to travel to Kansas City and Denver, before
returning to Menlo Park, California, where Facebook is headquartered.
A host of Wall Street
banks are underwriting Facebook’s offering, with Morgan Stanley, JPMorgan and Goldman Sachs serving as
leads. Facebook will trade on Nasdaq under the symbol
FB.
CNBC reported the higher price range earlier, citing sources.
(Reporting by Olivia
Oran; Editing by Richard
Chang, Edwin Chan,
Orr and Ryan Woo)