NEW YORK/SAN FRANCISCO, Wed May 16, 2012 – Facebook Inc. increased the size of its initial public offering by almost 25 percent, and could raise as much as $16 billion as strong investor demand for a share of the No.1 social network trumps debate about its long-term potential to make money.
Facebook, founded eight years ago by Mark Zuckerberg in a Harvard dorm room, said on Wednesday it will add about 84 million shares to its IPO, floating about 421 million shares in an offering expected to be priced on Thursday.
The additional shares will be sold by early investors including PayPal co-founder Peter Thiel, Accel Partners’ James Breyer and investment manager Tiger Global Management, the company said in a filing.
The company itself has not increased the number of shares it will sell.
Zuckerberg’s voting power will be reduced to about 55.8 percent from about 57.3 percent after the IPO as a result of the issue of additional shares, the company said.
The expanded size, coupled with Facebook’s recently announced plans to raise the IPO price range, would make Facebook the third-largest initial share sale in U.S. history after Visa Inc. and General Motors.
The social networking company is drumming up massive demand for the offering even as slowing revenue and user growth spur questions about the long-term Facebook story.
Those concerns over revenue growth were underscored on Tuesday, when GM said it planned to pull out of advertising on Facebook.