Appetiser?
LinkedIn has announced plans to go public in 2011 and as the first social network to do so, it will no doubt be under the spotlight as investors expect more to follow its lead- most tantalisingly, Facebook.
According to LinkedIn's blog, the firm has filed a registration statement with the Securities and Exchange Commission (SEC) for a proposed IPO, although the number of shares to be offered and the price range for the IPO has not been set. It said: "A portion of the shares will be issued and sold by LinkedIn, and a portion will be sold by certain stockholders of LinkedIn."
Morgan Stanley, BofA Merrill Lynch and JP Morgan Securities are the bookrunning managers of the proposed offering, while LLC Allen & Co plus UBS Securities will be acting co managers.
While LinkedIn's public success is of course of interest in itself, many investors will be keeping their eyes on LinkedIn's IPO to predict the appetite for Facebook, which is now valued at an unbelievable $50bn. Groupon's chief exec has also reportedly confirmed that his company is also considering going public.
Rory Maher, an analyst with Hudson Square research, told Reuters: "Facebook has definitely escalated people's interest in the sector and I think there's a lot of demand (for more Internet IPOs)."
Having seemingly been against an IPO before, Facebook has recently reportedly said it plans to make its financial results public by April 2012 because of the company's number of shareholders, in a move that many think will lead to an IPO.
According to LinkedIn's SEC filing, the firm's net revenue almost doubled to $161.4m in the first 9 months of last year, recording a healthy $1.85m profit.
To get an idea of just how big an IPO for Facebook could be, Reuters reported that according to a Goldman Sachs prospectus, Facebook is thought to have made $1.2bn in revenue in the same time frame, reaping profit of around $355m. Linked In has 90 million users, while Facebook has over 500 million.
