Facebook IPO

Facebook Said to Plan Its IPO Filing for as Early as Next Week

 Jan. 28 (Bloomberg) -- Facebook Inc., the world’s largest social-networking service, is aiming to file for its initial public offering as early as next week, two people with knowledge of the matter said.

The company is discussing a valuation of $75 billion to $100 billion, said two people, who asked not to be identified because the plans haven’t been made public. Timing for the filing is still being discussed and may change, they said.

The IPO would provide funds to help Facebook maintain its expansion and fend off competition from Internet rivals such as Google Inc. and Twitter Inc. The company has discussed raising $10 billion in the offering, a person familiar with the matter said in November. Facebook may set its price at the low end of the valuation range to entice investors and ensure the stock rises after the IPO, said Anupam Palit, an analyst at GreenCrest Capital Management LLC in New York.

“They might discount it a little bit in order to make sure the first couple days of trading are very strong,” he said.

Facebook is close to hiring Morgan Stanley to handle the deal, and Goldman Sachs Group Inc. will probably play a “major role” in the IPO, the Wall Street Journal said yesterday. The newspaper was first to report that Facebook may file its paperwork as early as next week.

Larry Yu, a spokesman for Menlo Park, California-based Facebook, declined to comment, as did representatives of Goldman Sachs and Morgan Stanley, both based in New York.

Trading Suspension

Shareholders of Facebook faced a three-day suspension of trading on secondary markets that lasted through yesterday, people with knowledge of the matter said this week. While buy and sell orders could be made, transactions wouldn’t be processed by Facebook’s attorneys at Fenwick & West LLC, the people said.

Halting the trading, which had allowed employees and early stakeholders to buy and sell shares, didn’t mean the filing is imminent, the people said. Still, some companies suspend trading ahead of a filing to make sure that investors can’t exchange shares until all of the information is public, said Sam Hamadeh, chief executive officer of New York-based PrivCo.

A trading halt also may represent an effort by private companies to ascertain how many shareholders they have.

Co-founded by Mark Zuckerberg in 2004 in a Harvard University dorm room, Facebook has amassed more than 800 million users with an easy-to-use website that lets anyone with an Internet connection construct profile pages, post video and photos and interact with friends. The company has nudged aside competitors such as MySpace Inc. and generates sales from advertisers as varied as AT&T Inc., Best Buy Co. and Sony Corp.

IPO Surge

Facebook would follow a flurry of social-media companies holding IPOs in 2011, the biggest year for U.S. Internet offerings in more than a decade, according to data compiled by Bloomberg. Nineteen companies raised $6.6 billion in 2011 -- the most since 2000, when 101 businesses raised $11 billion. Professional-networking site LinkedIn Corp., music-streaming service Pandora Media Inc., daily-deal site Groupon Inc. and social-gaming company Zynga Inc. all sold shares last year.

Facebook expects to be required by U.S. regulators to disclose financial results by April 30, if it doesn’t go public by then, the company said last year when it announced an investment from Goldman Sachs and other backers. The $1.5 billion investment valued the company at $50 billion.

Facebook decided to wait until 2012 for its IPO to give Zuckerberg more time to gain users and boost sales, people familiar with the matter said in 2010.

US Tax Deal

Swiss urge U.S. tax deal to shield other banks

DAVOS, Switzerland | Sat Jan 28, 2012 10:15am EST

(Reuters) - The break-up of Switzerland's oldest bank Wegelin on Friday shows the need to settle a dispute with U.S. authorities over tax cheats hiding cash in secret Swiss accounts, the finance minister said on Saturday.
"It is very regrettable," Eveline Widmer-Schlumpf told journalists at the World Economic Forum of the decision by Wegelin to break itself up in the face of possible indictment on charges the bank helped wealthy Americans to evade taxes.
"This development shows how important it is that we come to solutions in the discussions, negotiations with the United States which hopefully prevent other banks getting into a similar situation," she said.
The U.S. Department of Justice is probing 11 Swiss banks, including Credit Suisse (CSGN.VX), Julius Baer (BAER.VX) and Basler Kantonalbank (BSKP.S).
"I don't know whether other banks are in a similar or same situation...but what I know is that various banks are being threatened by the United States with prosecution and we will try to do everything...to come to a solution," Widmer-Schlumpf said.
Switzerland has been lobbying for a year to get the investigations dropped in return for the payment of a hefty fine and the transfer of names of thousands of U.S. bank clients suspected of dodging taxes.
UBS (UBSN.VX) paid $780 million to settle U.S. criminal charges in 2009 and also turned over the names of 4,500 clients.
Widmer-Schlumpf, who held talks in Davos this week with U.S. Treasury Secretary Timothy Geithner, said she hoped to reach a deal in the coming months, but declined to comment on the size of the fines under discussion for Swiss banks.
"It is up to the financial institutions to say how much they are prepared to pay. It is not up to the state," she said.
Switzerland struck deals last year with Britain and Germany that would allow their citizens to pay tax on secret accounts without revealing their identities, although these are being challenged by the European Commission which wants to force Switzerland to accept an automatic exchange of bank information.
Widmer-Schlumpf, who also holds the rotating Swiss presidency, said the European Unon had signaled to Switzerland it wanted to discuss a general accord with the bloc.
FRANC CAP ACCEPTED, RESPECTED
Separately, Widmer-Schlumpf reiterated the determination of the Swiss National Bank to defend the 1.20 per euro cap on the franc it imposed last year even after the resignation of former bank chief Philipp Hildebrand over a currency trading scandal.
"They have said they will do everything to pursue this policy so the signal is clear," she said.
"We see today that 1.20 is accepted, is respected. Whether the national bank decides sometime to move it, it will have to examine itself and whether it can be defended. That is not up to politicians, that is up to the national bank."
Thomas Jordan, SNB vice chairman who took over as interim head after Hildebrand stepped down, has vowed to defend the cap and said the SNB would take further steps should the economic outlook and deflationary risks make them necessary.
"Mr Jordan is doing an excellent job," Widmer-Schlumpf said, adding she hoped the SNB's supervisory council would make a proposal as quickly as possible over who should replace Hildebrand permanently.

Exxon Tonen

Exxon to sell part of Tonen stake for $3.9 billion: sources

TOKYO | Sat Jan 28, 2012 11:16am EST

(Reuters) - Exxon Mobil (XOM.N) plans to sell a large part of its 50 percent stake in TonenGeneral Sekiyu KK (5012.T) back to its Japanese refining partner in a deal that could be worth about 300 billion yen ($3.9 billion), and will make an announcement as early as Monday, four sources with direct knowledge of the matter said.
Exxon Mobil will retain about a 20 percent stake in TonenGeneral but the deal will mark a de facto retreat from the world's third-largest economy by the U.S. oil giant, which is focusing its resources on emerging markets and development of natural resources.
The move could also spark realignment among Japan's oil refiners, which have been cutting capacity to cope with falling demand caused by a weak economy and a shift to more efficient and environmentally friendly forms of energy, analysts have said.
Reuters reported earlier this month that Exxon was in talks to sell part of the stake back to TonenGeneral.
TonenGeneral, which imports and distributes Exxon oil in Japan, ranks as the country's No. 2 refiner behind JX Holdings (5020.T). Smaller rivals include Idemitsu Kosan Co (5019.T), Cosmo Oil (5007.T) and Showa Shell (5002.T).
Exxon and TonenGeneral aim to complete the deal around summer, the sources told Reuters on condition of anonymity.
TonenGeneral will seek funds from Sumitomo Mitsui Banking Corp, Sumitomo Trust Banking, Bank of Tokyo Mitsubishi UFJ and Mitsubishi Trust Bank to buy back the stake, the sources said.

RBS Updated

RBS chairman waives $2.2 million bonus after Hester row

LONDON | Sat Jan 28, 2012 11:12am EST

(Reuters) - Royal Bank of Scotland's (RBS.L) Chairman Philip Hampton will not pick up a 1.4 million pound ($2.2 million) stock bonus, the bailed-out bank said, following public anger and political squabbling over a 1 million pound bonus for its chief executive.
Anger over bankers' earnings has shown few signs of abating, with many still set for million pound salaries while elsewhere thousands lose their jobs as the global economy stutters in the face of Europe's debt crisis.
In Britain, the salaries of top staff at RBS and Lloyds (LLOY.L) are particularly controversial because both banks were bailed out to the tune of 66 billion pounds during the credit crisis, with Britain ending up with an 83 percent stake in RBS along with a 40 percent holding in Lloyds.
"Sir Philip Hampton will not receive the 5.17 million shares he was awarded in 2009 when he joined RBS," said a spokesman for the bank.
Based on RBS's closing share price of 27.74 pence Friday, Hampton's share-based award would have been worth 1.4 million pounds. In 2010, Hampton received a basic salary of 750,000 pounds, with no extra performance bonus or benefits.
The decision not to proceed with Hampton's stock award comes after politicians from across the spectrum criticised the company's decision to give its chief executive Stephen Hester a stock bonus worth roughly 1 million pounds.
Earlier this week, RBS halved CEO Hester's stock bonus for 2011 to just under 1 million pounds from 2 million pounds in 2010, but resisted calls to axe the bonus altogether. Hester has a basic salary of 1.2 million pounds.
The decision by Lloyds chief executive Antonio Horta-Osorio to waive his bonus after he spent time off work on sick leave, had put further pressure on Hester to make a similar gesture.
CAMERON SEEKS TO DEFLECT CRITICISM OVER RBS PAY
RBS shares fell sharply over the course of 2011, losing approximately half their value, and the stock remains well below the average price of 49.90 pence at which the British taxpayer acquired its stake in the bank.
Hester has also had to cut more than 30,000 jobs since taking up his post in 2008, as part of a large-scale restructuring to sell off assets and businesses.
Britain's Conservative-led coalition government has also been criticised for not doing more to curb Hester's pay, facing attacks from not only the opposition Labor party but also from its own members.
Saturday, Prime Minister David Cameron sought to deflect criticism over his handling of the issue, arguing it would be worse for the taxpayer if RBS had to find a new management team.
"Let me get the facts straight, the fact is Stephen Hester was brought in by the last government, a contract signed by the last government, to turn round RBS, a bank that had got itself into a complete mess," Cameron told television reporters.
"The government has made its views known, and that is why his bonus was cut in half compared to last year. But we do have to bear in mind that the alternatives to what is happening now could be even more expensive if you had a whole new team coming into RBS," he added.
Hester joined RBS in October 2008 from property company British Land (BLND.L) as RBS was reeling from its disastrous acquisition of Dutch bank ABN AMRO.
Britain used some 45 billion pounds of taxpayers' money to rescue RBS, leading to the eventual resignation of former head Sir Fred Goodwin, who was replaced by Hester.
Hester, who had previously worked at rival banks Abbey National and Credit Suisse (CSGN.VX), was given a brief to restructure RBS and return it to health, and RBS said he deserved his stock bonus for making the bank "safer."
Britain aims to eventually sell its state holdings in RBS and Lloyds back to the private sector, although volatile financial markets have meant the timing of any disposal is uncertain.