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Morgan Stanley, Goldman Sachs, lead race to manage Facebook IPO

Morgan Stanley, Goldman Sachs, lead race to manage Facebook IPO

Financial services giants Goldman Sachs and Morgan Stanley are said to be the front-runners for the role of lead investment banker in Facebook's much-awaited blockbuster initial public offering next year, a media report said.

Financial services giants Goldman Sachs and Morgan Stanley aresaid to be the front-runners for the role of lead investment banker inFacebook's much-awaited blockbuster initial public offering next year, a mediareport said.

Touted as one of the biggest IPOs in over a decade,Facebook's stock sale of about $10 billion is expected to take place in early2012.

With the Californiacompany planning to file offer documents in early 2012, a decision on bankers"could be soon", a report in the Wall Street Journal said.

Goldman and Morgan Stanley are "consideredfront-runners" for the lead investment-banking role, which could net thebankers anywhere up to $220 million in IPO fees as well as "braggingrights" for managing the trophy IPO.

The fee for IPOs like Facebook's stock sale - which could beas big as USD 10 billion, valuing the company at 100 billion dollars - averages2.2 per cent.

"That would mean a possible total payoff of as much as $220million, though the company could negotiate lower fees because the Facebookdeal is such a trophy," the Wall Street Journal report said.

The report quoted people in-the-know as saying that somebankers have been "waiting by the phone" over the holidays for thecall that they will be participating in the company's IPO in some way.

Facebook executives have been meeting with Wall Street firmssince late November as they geared up for the IPO, according to people familiarwith the situation.

"Goldman and Morgan face stiff competition from rivalinvestment banks vying for the prize of becoming the lead manager. Still, bothare seen as having a leg up on competitors, even though each has possibleknocks against them," the report added.

While Goldman orchestrated a $1.5 billion private offeringof Facebook shares in January, Morgan Stanley has been the leading bank forinternet IPOs this year in the USand worldwide.

The report said Goldman Chairman and Chief Executive LloydBlankfein "went to woo" at least one Facebook board member earlierthis fall.