With 800 million shares held by its employees and early investors now eligible for sale on the Nasdaq exchange Facebook’s stock prices could face another round of stuffing.
The initial lock-up period that barred certain holders from selling their shares in the social networking giant, following its public offering back in May, has now expired – something that could result in double the number of publicly traded shares.
Currently that figure stands at 921 million although not all holders are likely to cash in.
In only its first six months as a public company, 1.3 billion Facebook shares were released from similar lock-up provisions – but not those owned by founder Mark Zuckerberg.
Zuckerberg is now eligible to sell his 504 million shares, worth $10 billion (£6.3 billion); however, he has already vowed to hold on to them until at least September 2013.
Other major figures have not hesitated in selling up their shares in the site which has revolutionised social media marketing though. Those previously cashing in on their shares including Facebook’s chief operating officer, Sheryl Sandberg and general counsel, Ted Ullyot.
More significantly, however, is the decision of one of Facebook’s most prominent backers, venture capitalist Peter Thiel, to sell more than 80 per cent of his stake since the initial float – worth over $1 billion.
The expiration of previous lock-up periods have seen Facebook’s share prices plummet down to half its initial $38 IPO level, but analysts have suggested that short-sellers are beginning to lose interest, which would suggest the drop may not necessarily be as severe this time.
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