Who’s accountable for Facebook IPO flop?
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Who’s accountable for Facebook IPO flop?

In my last column, I predicted that the over-hyped Facebook initial public offering was an ominous sign for the health of equity markets. Nevertheless, Facebook and flop were not words I expected to see in the same sentence. I was wrong. I’ve watched some deals backfire during my time as a Euromoney columnist: the listings of Bumi and Blackstone come to mind as well as Prudential’s grandiose plan in 2010 to purchase AIA, the former Asian arm of AIG. But the Facebook IPO is one of the biggest collapsed soufflés of them all.

Teeny-bopper CEO Mark Zuckerberg will not be pleased. He is not at ease with the press: something that will have to change now that he is leading a public company. The current adverse publicity will not be going down well at the company’s Menlo Park headquarters.

For a seasoned cynic such as myself, the hype surrounding the deal was a counter-indicator. For days before the launch, business network CNBC had round-the-clock coverage of Facebook: various talking heads opined on anything from Zuckerberg’s upbringing to the valuation of the deal. And of course the valuation at some 75 times projected 2012 earnings was absurd.

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