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He insisted there would have been "considerable risks" in setting the initial share price higher, given the Government's intention of attracting long-term investors.
If the only shares sold are Yahoo's, Alibaba's bosses could be less concerned about a high initial share price and more interested in strong stock performance thereafter.
After the offering, approximately 562.2 million shares in Palm will be outstanding, putting its initial market capitalization about $17.4 billion based on an initial share price of $31, the midpoint of the new range.
Cable was criticised for describing the initial share price reaction – when it surged 38% on the first day – as "froth" and declaring the shares would take months to find their true level.
So far this year, the average I.P.O. in the industry has closed 24.6 percent higher than the initial share price on its first day of trading, according to data from the brokerage firm Morgan Keegan.
Still, the consensus is that shares in a newly offered company will tick up by 10-15%.Local banks appear to share the confidence, extending margin loans for up to 90% of the initial share price.
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The result of Zuckerberg's comments was a reversal of Facebook's initial 2percentt share price gain after earnings were announced that dragged it down to a 3.5percentt loss.
This was lower than expected, though with investors clamouring for a slice of the initial public offering, the share price is expected to climb once trading commences.
Only one other company has had an initial offering with a share price of more than $100 -- Chicago and North Western Holdings, a railroad company that went public at $189.65 a share in 1989, according to Thomson Financial.
But it cannot alone be blamed for the initial surge in the share price, he says.
Mark Pincus, who obtained several hundred thousand dollars' worth of Google shares through the auction, said he thought Google made a mistake by setting too high an initial target range for the share price, which made the final clearing price of $85 seem to be a defeat.
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