DNS - Facebook to Stage IPO or Disclose Financial Information in 2012

After breaking investment news earlier this week, Facebook (News - Alert) announced it is likely to reach the Security and Exchange Commission’s 500-shareholder mark this year—requiring the social networking giant to disclose its financial information or stage an initial public offering, expected in April 2012.

The Wall Street Journal accessed the 100-page private placement memo currently circulating among potential investors before Facebook actually reaches the number of shareholders where the SEC (News - Alert) requires companies to disclose information regardless as to whether or not a company is traded publicly. The regulation gives companies 120 days after hitting the mark to register as a reporting company.

This move comes after it was revealed earlier this week that Facebook had engaged in a private investment campaign through Goldman Sachs, already raising $500 million in investments. The Journal reported that the rumors suggesting this was in an effort to avoid an IPO or public disclosure is discredited in the document, which indicates that the social networking company is likely to be traded publicly in 2012.

Goldman’s private share offering for Facebook spurned much speculation before the contents of the 100-page document were revealed. 

Paul Bard, IPO analyst and president of Renaissance Capital told MarketWatch two days ago that Facebook was an unlikely candidate to go public before 2012, saying “Facebook is in an enviable position in that investors are willing to throw money at them at any time.”

“We believe Facebook is likely to file for an IPO by the end of 2011, which would set them up for an IPO sometime in early 2012,” he correctly predicted.