Facebook is set to file its IPO as early as Wednesday, seeking a valuation between $75 billion and $100 billion, according to the Wall Street Journal, citing unnamed sources.
The company is reportedly seeking to raise as much as $10 billion. If successful, that would make Facebook's offering the sixth largest U.S. IPO and six times larger than Google's initial offering, which is currently the record-holding tech IPO.
The Wall Street Journal reported that Morgan Stanley is close to securing the leading underwriting role, with Goldman Sachs also playing a key role.
Mark Zuckerberg founded the company in his Harvard dorm room at age 19. Now 27, Zuckerberg's stake in Facebook will be worth an estimated $20 billion after the IPO — making him one of the world's richest men.
Beyond minting an estimated 1,000 new millionaires at the company, Facebook's initial public stock offering could provide a huge boost to Wall Street investment banks sorely in need of a hot stock to excite investors. The right to manage the IPO will also generate an estimated $250 million in fees.
Facebook faces hurdles, to be sure. Increased competition from Google+ and Twitter is likely forcing the IPO moment. It is expected to raise $10 billion in the offering, giving it a market capitalization of $100 billion. Google, by comparison, raised $1.9 billion in its IPO in 2004.
Facebook has become one of the world's best-known consumer brands and the Web's most popular hangout. And sometime this year it's expected to hit 1 billion users. That's half of all people on the Internet and 1 in 7 people on the planet.
Prominent Financial Analysts across the world have predicted The minute the IPO is filed, there will be total chaos in stock markets.
A successful IPO by one of the USA’s most prominent companies also could power the stock market higher by attracting scores of investors who have been scared off by the volatility in recent years. Facebook’s success lies in the hoard of information it holds about its users — valuable information that advertisers can use to target their products and services. Its growing business has escalated competition with rival tech giants Google andApple Inc.
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