Allied Journal


Googles IPO may see delay due to article in 'Playboy'
13 Aug 2004

Google Inc. plans to open the auction for its hotly anticipated IPO today and set the final price next week, despite legal questions about a newly published Playboy interview with the founders of the online search engine.

The 28 brokerages handling Google's unorthodox initial public offering will begin accepting bids at 6 a.m. Arizona time today.

All bidders must already have obtained one of the registration numbers that Google has distributed during the past two weeks.

Google and its insiders hope to raise about $3 billion by selling stock at a price ranging from $108 to $135 per share. But the so-called Dutch auction could change that price, particularly if most of the bids fall below the $108 target.

The auction is expected to be wrapped up sometime next week, the company said Thursday.

But Playboy's interview with Google co-founders Larry Page and Sergey Brin could change the company's IPO timetable.

In the article, Page and Brin discuss the company's rapid growth and even brag about how Google's search engine has helped save people's lives.

The interview, contained in a Playboy issue delivered to some subscribers Thursday, threatens to delay Google's initial public offering because securities regulations restrict what executives can say while preparing to sell stock for the first time.

"I don't want to rain on their parade, but I think this interview is going to cause regulatory concern. There could be consequences," said Michael Zuppone, a former SEC attorney.

This presents a problem, as it could bankrupt Google in one fell swoop- the company itself would be obligated to buy all those shares back, but over half the cash from the IPO is going into the pockets of employees and venture capitalists who are under no such obligation.

Google Inc. plans to open the auction for its hotly anticipated IPO today and set the final price next week, despite legal questions about a newly published Playboy interview with the founders of the online search engine.

The 28 brokerages handling Google's unorthodox initial public offering will begin accepting bids at 6 a.m. Arizona time today.

All bidders must already have obtained one of the registration numbers that Google has distributed during the past two weeks.

Google and its insiders hope to raise about $3 billion by selling stock at a price ranging from $108 to $135 per share. But the so-called Dutch auction could change that price, particularly if most of the bids fall below the $108 target.

The auction is expected to be wrapped up sometime next week, the company said Thursday.

But Playboy's interview with Google co-founders Larry Page and Sergey Brin could change the company's IPO timetable.

In the article, Page and Brin discuss the company's rapid growth and even brag about how Google's search engine has helped save people's lives.

The interview, contained in a Playboy issue delivered to some subscribers Thursday, threatens to delay Google's initial public offering because securities regulations restrict what executives can say while preparing to sell stock for the first time.

"I don't want to rain on their parade, but I think this interview is going to cause regulatory concern. There could be consequences," said Michael Zuppone, a former SEC attorney.

This presents a problem, as it could bankrupt Google in one fell swoop- the company itself would be obligated to buy all those shares back, but over half the cash from the IPO is going into the pockets of employees and venture capitalists who are under no such obligation.


 

 


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