Facebook IPO Cost Another Company $350 Million

Sites include Facebook.com , ubs.com . Published on August 20th, 2012. Written by Anthony West.

The Facebook IPO had many casualties. From the small scale investor all the way up to the institutional big boys. But now details are emerging which suggest that even the companies that facilitated the IPO have lost money.

UBS AG, the Zurich based banking conglomerate is reporting a $350 million loss as result of the IPO. UBS was one of the market makers for the IPO and it is accusing Nasdaq OMX Group Inc. of botching the whole thing. If you’ll recall on the day of the IPO traders were unable to execute trades for well over an hour and many people lost thousands in the opening rounds.

In the weeks following the IPO Facebook stocks dropped massively and today the stock over at the $20 mark. UBS seems to be absorbing the loss as there are no talks of a lawsuit (yet). Many investors who haven’t got the wherewithal to absorb have sued and the outcomes of those actions are still to be determined.

That a tech stock could end up having one of the biggest flops in IPO history because of technical glitches is laughable and somewhat ironic. Companies like UBS will probably rue the day they got caught up in the Facebook hype. The only hope companies like UBS and small scale investors have is that Facebook delivers on the promise of the early years. It is yet to surpass the 1 billion active user mark, and when then happens, there will be lots of money to be made.