Professor Elam

Tuesday May 22, 2012

Morgan Stanley and NASD are being blamed for the poor performance of the FB Initial Public Offering IPO.

This article is instructive by explaining how the underwriting process works, or should work. 

In this case, Second Market had already been managing the real IPO, which occurred in 2010 among private investors. They did well and the stock has advanced from an initial $6.81 to the final $38 offer price. So the early investors did well. It is important that accounting students understand this process.