Pulse2 Technology and Social Media News » Morgan Stanley

Morgan Stanley Banker Michael Grimes Gets Knocked On For Facebook IPO

Amit Chowdhry — Sun, 27 May 2012 17:00:24 +0000

After Facebook’s stock price dropped from $38 to below $32, Morgan Stanley investment banker Michael Grimes has been put on the spot. Grimes, co-head of the global technology banking at Morgan Stanley, has been capitalizing off of Silicon Valley companies since the mid-1990s. Facebook CFO David Ebersman relied heavily on Grimes’ advice during the IPO process. The two live a couple of miles apart and it was Grimes that counseled Ebersman to boost Facebook’s IPO price to $38 and increase the number of shares before the IPO.

Even though Grimes declined to give a comment about the matter, sources say that he believes he did an excellent job for Facebook. Grimes has been in frequent touch with Facebook officials since the stock price was set.

When asked about what happened to the Facebook stock by potential clients, Morgan Stanley officials blamed Nasdaq’s technical problems. Morgan Stanley bankers are also saying that Ebersman made the final decision to boost the price and number of shares.

Other technology companies that Morgan Stanley took public last year include Zynga and LinkedIn. Zynga shares have plummeted, but LinkedIn’s stock price has more than doubled.

“Nothing I’ve heard so far would change my confidence in Michael and his team,” stated Stan Meresman, a director at LinkedIn and Zynga. “They are smart, knowledgeable and tell it to you straight, which is a rare commodity.”

Facebook and Banks Being Sued Over IPO

Amit Chowdhry — Wed, 23 May 2012 14:28:21 +0000

Facebook Inc. (NASDAQ:FB) and banks that include Morgan Stanley are being sued by the shareholders that claimed the defendants weakened growth forecasts ahead of the $16 billion IPO. The defendants including Facebook CEO Mark Zuckerberg are being accused of concealing “a severe and pronounced reduction” in revenue growth forecasts, which resulted from increased use of its app through mobile devices. The lawsuit was filed in the U.S. District Court in Manhattan. In this case, shareholders are saying that research analysts at several underwriters lowered business forecasts for Facebook during the IPO process, but the changes were “selectively disclosed by defendants to certain preferred investors” instead of to the public.

“The value of Facebook common stock has declined substantially and plaintiffs and the class have sustained damages as a result,” is quoted from the complaint. Facebook shares had dropped 18.4% from the $38 IPO price in the first three days of trading, which reduced the value of stock sold in the IPO by over $2.9 billion. The company’s market cap fell from $108 billion to less than $70 billion since then.

Morgan Stanley Cut Facebook’s Revenue Estimates Right Before IPO

Amit Chowdhry — Tue, 22 May 2012 13:31:32 +0000

During Facebook’s investor roadshow before the company IPO, lead underwriter Morgan Stanley delivered the news to clients that revenue forecasts were being reduced by the company. This could have been one of the reasons for the weak performance of Facebook shares between Friday and today. The $38 per share value valued Facebook at $104 billion.

“This was done during the roadshow – I’ve never seen that before in 10 years,” said an executive at a mutual fund firm that was called by Morgan Stanley. Goldman Sachs and JPMorgan Chase were also underwriters in the IPO and they revised their estimates in response to Facebook’s May 9 SEC filing. Generally underwriters in a company need to put a positive spin on negative news.

Morgan Stanley’s consumer Internet analyst Scott Devitt cut Facebook’s revenue estimate for the current second quarter significantly and cut the entire 2012 forecast.

How BATS Had One Of The Most Disastrous IPO Experiences

Amit Chowdhry — Sat, 24 Mar 2012 04:21:57 +0000

Bats Global Markets is a 6 year old equity exchange that had to cancel their IPO after errors on their own computer systems derailed trading and caused a halt in Apple. Bats withdrew their IPO as a result of the errors.

Data received by the stock market on Friday showed that Bats was trading at under a penny after being priced on Thursday at $16. At that same time, a 100-share transaction in Apple was executed on Bats so far away from the market price causing it to trigger a halt.

Bats stands for Better Alternative Trading System. They priced 6.3 million shares through underwriters Thursday and appeared set to begin trading at about 90 minutes into the day. The company quoted their shares at $15.25 at 10:45AM on their website, but financial feeds sent to Bloomberg said that 1.26 million shares had been traded with the most recent execution being at 3.84 cents and the lowest transaction being 0.02 cents.

A single trade for 100 shares executed on a Bats venue at 10:57AM sent Apple down more than 9% briefly at $542.80. The cancelled stock offering intended to raise money for Bats’ owners including underwriters Morgan Stanley, Citigroup, and Credit Suisse. Tradebote Systems, Getco, and Wedbush expected to see proceeds from the deal as well.

Bats was founded by a high-frequency trader in 2005 and it was steered to prominence by brokers attempting to hold down fees as the New York Stock Exchange and Nasdaq Stock Market bought their biggest electronic rivals. The company executed 10.9% of U.S. equities volume last month compared with 10.7% a year earlier.

Facebook To File For IPO As Early As Wednesday

Amit Chowdhry — Sat, 28 Jan 2012 00:15:54 +0000

Facebook is expected to file papers for an IPO next week on Wednesday. The IPO is expected to value the company at between $75 and $100 billion. Morgan Stanley is expected to close the deal for underwriting the IPO. Goldman Sachs is also expected to play a large role in the deal. Other executives are saying considering filing a few weeks from now.

With a valuation of between $75 and $100 billion, Facebook is looking to raise about $10 billion. The $10 billion Facebook would raise would rank fourth largest among U.S. companies after Visa, GM, and AT&T Wireless. Facebook would be worth about the same as McDonald’s and about half of Google.

AVG Files For Proposed IPO

Amit Chowdhry — Sun, 15 Jan 2012 00:33:23 +0000

AVG, the software company that was founded in 1991 and is known for their anti-virus software, has announced that they have filed a Registration Statement on Form F-1 with the U.S. SEC in connection with a proposed IPO of their ordinary shares. AVG will sell on the New York Stock Exchange with the symbol “AVG.” Morgan Stanley, JP Morgan, and Goldman Sachs will be running the books on the IPO. Co-managers for the IPO include Allen & Company and JMP Securities.

Morgan Stanley: Nokia Could Potentially Sell 37 Million Units In 2012 [REPORT]

Amit Chowdhry — Thu, 12 Jan 2012 02:45:17 +0000

The year 2011 has not been a great year for Windows Phone, but 2012 may be different. Now there is a decent selection of Windows Phone devices that are out there, including the Nokia Lumia 900. Morgan Stanley is expecting shipment of Nokia’s new Windows-based devices to hit about 37 million units in 2012 and 64 million in 2013.

When you include HTC Windows Phone handsets, about 43 million handsets total powered by Windows Phones could be shipped this year and 74 million the year after. These are numbers from just two OEMs.

“We’ve got a lot of room to go in selling Windows Phones,” stated Microsoft CEO Steve Ballmer at the Consumer Electronics Show (CES). “But I feel very much like the work we’re doing is really going to pay off.”

Glam Media Plans To IPO In Second Half Of Next Year

Amit Chowdhry — Tue, 20 Dec 2011 00:54:10 +0000

Glam Media is expected to have an IPO in either the third or fourth quarter of 2012. The company is currently talking to bankers such as Goldman Sachs and Morgan Stanley to lead the IPO. Glam Media is expected to top 206 million unique visitors per month across all of their properties. It is currently a comScore Top 10 U.S. Web Property. Glam is rumored to be valued at $950 million after acquiring Ning for about $200 million. [BusinessInsider]

SAP Acquiring SuccessFactors For $3.4 Billion

Amit Chowdhry — Sun, 04 Dec 2011 08:15:02 +0000

Enterprise IT company SAP AG (NYSE:SAP) is acquiring SuccessFactors for $3.4 billion or $40 per share. The transaction was made entirely in cash and is expected to close early next year. This is a 52% premium above Friday’s closing price.

“The cloud is a core of SAP’s future growth, and the combination of SuccessFactors’ leadership team and technology with SAP will create a cloud powerhouse,” stated SAP co-CEO Bill McDermott.

SuccessFactors is an employee management software companies that helps companies assess performance of employees. It also helps manage recruitment and human source needs for companies. SuccessFactors reported revenues of $91.2 million in the third quarter. SuccessFactors has over 3,500 customers spread across 170 countries.

Morgan Stanley served as the financial adviser for SuccessFactors and JPMorgan Chase advised SAP.

[NYT]

How Much Groupon Executives and Investors Made From The IPO

Amit Chowdhry — Sat, 05 Nov 2011 20:57:39 +0000

Yesterday Groupon Inc. (NASDAQ:GRPN) had an initial public offering. The company set their stock price at $20 and yesterday it closed at $26.11. The company was given a valuation of over $17 billion. BusinessInsider.com has compiled a list of how much the executives and investors made from the IPO. Below is the list:

Ted Leonsis – Former AOL Vice Chairman – Made $48.27 million from 1,848,770 shares owned
Brian Totty – Groupon SVP of Engineering – Made $16.31 million from 624,786 shares ownde
Howard Schultz – Starbucks CEO/Groupon board member – Made $49.59 million from 1,899,336 shares owned
Kenneth M. Pelletier – Former Groupon CTO – Made $70.47 million from 2,698,944 shares owned
Robert S. Solomon – Former Groupon President and COO – Made $105.88 million from 4,055,000 shares owned
Andreessen Horowitz – VC Firm – Invested $40 million, Earned $132.2 million, Gain of $92.2 million
Maverick Fund – VC Firm – Invested $50 million, Earned $165.3 million, Gain of $115.3 million
Greylock Partners – VC Firm – Invested $65 million, Earned $214.9 million, Gain of $149.9 million
Kleiner Perkins Caufield & Byers – VC Firm – Invested $65 million, Earned $214.9 million, Gain of $149.9 million
Morgan Stanley – VC Firm – Invested $75 million, Earned $248 million, Gain of $173 million
T Rowe Price – Investment Firm – Invested $100 million, Earned $330.6 million, Gain of $230.6 million
Fidelity Investments – Investment Firm – Invested $100 million, Earned $330.6 million, Gain of $230.6 million
Battery Ventures – VC Firm – Invested $58 million, Earned $417.4 million, Gain of $359.4 million
Technology Crossover Ventures – VC Firm – Invested $150 million, Earned $459.9 million, Gain of $345.9 million
The Growth Fund of America – Fund – Invested $175 million, Earned $578.6 million, Gain of $403.6 million
Accel Partners – Invested $20 million, Earned $866.96 million, Gain of $856.96 million
Digital Sky Technologies – Invested $151 million, Earned $1.11 billion, Gain of $959 million
The European Founders Fund – Earned $1.02 billion based on 6.2% ownership in Groupon
Brad Keywell – Groupon Co-Founder – Earned $1.07 billion based on 6.5% ownership
Andrew Mason – Groupon CEO – Earned $1.2 billion based on 7.3% ownership
New Enterprise Associates – VC Firm – Invested $14.8 million, Earned $2.28 billion, Gain of $2.26 billion
Eric Lefkofsky – Groupon Co-Founder – Gained $1.67 billion based on over 10% ownership of the company
Elizabeth Lefkofsky – Wife of Eric – Gained $1.67 billion based on over 10% ownership of the company