Facebook says SEC’s IPO probe ends, extending WhatsApp closing date

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– Facebook Inc said the .S. Securities and Commission dropped its probe into the social networking events surrounding its controversial initial public offering.

In its quarterly report filed on Thursday, Facebook said the regulator in May “notified us that it had terminated its inquiry and that enforcement action had been recommended by the SEC.”

Facebook shares began trading on May 18, 2012, but soon fell below their $38 per share offering and had lost more than half their value by the middle August, angering investors.

The launch had been tarnished by technology problems that delayed trading and caused difficulty in processing trades.

Investors also complained they were told just prior to the IPO that analysts at Facebook’s investment banks were cutting their forecasts after learning the ’s internal projections for advertising .


The end the SEC probe does affect shareholder litigation against Facebook, Chief Executive Mark Zuckerberg and many banks the Menlo Park, California-based ’s IPO. This litigation remains pending in Manhattan federal court.

Separately, Facebook said in the quarterly report it may extend by one year the date by which it is expected to close its $19 billion purchase of messaging startup WhatsApp.

Facebook had agreed to pay a termination fee of $1 billion in cash and $1 billion in stock if the purchase did close by Aug. 19, 2014. It said it expects to extend this date to Aug. 19, 2015 because it will meet conditions allowing the extension. The transaction is still expected to close this year, it added. (Reuters)