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Goldman Sachs (NYSE:GS) and funds managed by the firm will sell approximately $1 billion of stock in Facebook’s (NASDAQ:FB) initial public offering. The investment bank and its funds will cash out almost half their stake after the social network doubled in value.
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Goldman Sachs and its fund will sell 28.7 million of the 65.9 million shares they own, which is more than twice the amount initially planned. The shares are being offered at $34 to $38 apiece. This means that the stock being sold in this week’s IPO is valued between $975 million and $1.09 billion.
If the IPO’s underwriters decide that there is enough demand, Goldman Sachs and its funds could sell an additional 4.3 million shares, which brings the total to as much as $1.25 billion. Underwriters include Morgan Stanley (NYSE:MS) JPMorgan Chase (NYSE:JPM), and Goldman Sachs.
According to the Facebook filing, Goldman Sachs is selling 6.18 million of the 14.2 million shares it owns for its own account. The IPO price range values the bank’s total investment at between $483 million and $540 million. The fifth-largest U.S. bank by assets will be cashing out $210 million to $235 million of that total in the IPO.
Without a doubt, Goldman’s Sachs’ stake in Facebook will help the bank mitigate weakness in investment banking and trading revenue. Analysts expect gains to be recognized in the firm’s second-quarter results.
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