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.”