Google limbers up for shares auction
Internet search engine Google's share auction is to start today at 2pm Irish time. The company will make its Nasdaq stock exchange debut next week.
The shares are to trade on the best price from the auction, which is only open to bidders who signed up before Thursday's deadline on Google's IPO web site.
Google picked two long-established investment bankers – Morgan Stanley and Credit Suisse First Boston – to manage its unconventional IPO approach.
The company expects to sell 25.7 million shares between $108 and $135 per share, depending on the outcome of the auction.
The flotation represents about 9% of Google's capital, and if the price reaches the upper estimate its total stock market value could be more than $36bn (€29.5bn), putting it on a par with its internet rival Yahoo.
The share auction represents a significant milestone in the five-year-old company’s evolution from a fun-loving start-up to a corporate adolescent that will be held more accountable for how it manages its money.
Documents filed with the US Securities and Exchange Commission gave the public its first peek at the privately held company’s finances.
The company earned $105.6m (€88m), or 41 cents per share, on revenue of $962m (€803m) last year.
It got off to a fast start this year, with a first-quarter profit of $64m (€53m), or 24 cents per share – more than doubling its earnings of $25.8m (€21.5m), or 10 cents per share, at the same time last year.
By going public, Google will be under greater pressure to produce steady earnings growth – an expectation that some executives say leads to short-sighted management decisions.
