Facebook plans to raise $10.6b in IPO

SAN FRANCISCO - Facebook Inc aims to raise about $10.6 billion in Silicon Valley's largest IPO, dwarfing the coming-out parties of tech companies like Google Inc  and granting the world's largest social network a market value close to Amazon.com's.

The eight-year-old social network that began as Mark Zuckerberg's Harvard dorm room project indicated an initial public offering price range of between $28 and $35 a share on Thursday, yielding a valuation of $77 billion to $96 billion.

Facebook Vice President of Product Chris Cox delivers a keynote address at Facebook's "fMC" global event for marketers in New York City in this Feb 29, 2012 file photograph. [Photo/Agencies]

The social networking phenomenon stands to raise as much as $12 billion at the upper end of that range. But if an over-allotment or "greenshoe" option is triggered, the company could sweep up a maximum of $13.6 billion, according to a Thursday prospectus.

The indicative price range can be adjusted depending on Wall Street's response. Investors are expected to flock to the highly anticipated IPO, though some have voiced concerns about the social network's longer-term growth.

Last week, Facebook reported its first quarter-to-quarter revenue slide in at least two years, a sign that the social network's sizzling growth may be cooling just as it prepares to go public. Its stock should begin trading in about a week or two.

"People are going to be very comfortable with this valuation," said Sam Schwerin of Millennium Technology Value Partners, which owns Facebook shares worth roughly $200 million. The firm is not selling in the IPO.

"A price range of $28 to $35 will be a relief to some people who are concerned that they may try to take the highest possible price because of high demand.

"The amount being raised is noteworthy. Selling stockholders are raising about $5 billion in the IPO, which is a lot," Schwerin said.

Facebook executives are due to hit the road on Monday, presenting their investment case to audiences. They will start in New York, go to other major cities such as Chicago and Boston, and end up on Facebook's home turf in Menlo Park, California, according to a schedule obtained by Reuters.

Zuckerberg is expected to participate in the two-week roadshow, a source has said, though Chief Operating Officer Sheryl Sandberg and Finance Chief David Ebersman will lead the briefings.