Google's A Go: SEC Clears Way, Trading Begins Today

by , Aug 18, 2004, 12:00 AM
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Shortly after the stock market closed on Wednesday, the Securities and Exchange Commission gave Google the go-ahead to begin selling its shares to the public. New data from Hitwise reflects the tumultuous two-week bidding process, and suggests that despite the ubiquity of Google's IPO, demand steadily waned over time.

According to Hitwise, with the notable exception of spikes on August 5th and August 10th, traffic to the Google IPO site waned steadily after it went live on July 31st. It received up to 2.3 times more visits on July 31st than it did on average for the remaining bidding days. However, even the traffic spikes on the 5th and the 10th were 26 percent and 32 percent--respectively--lower than levels experienced on the opening day of bidding.

Bill Tancer, vice president research, Hitwise, opined that these traffic figures indicated a waning interest in the Google IPO, and are suggestive of its outcome. "This is a great example of how online behavior can be used to predict the outcome of a Web-based IPO auction," he said, adding that "the decrease in visits [to the Google IPO Web site] that we detected leading up to the close of bidding correlates with Google's decision to decrease target price and shares offered due to lower than anticipated demand."

Since the company initially wanted to begin the open-market trading process on Wednesday, but was denied approval by the SEC, trading might well begin this morning, although Google has yet to set the share price, which is expected to be between $85 and $95 a share, according to documents filed with the SEC. The company has 15 days to begin selling its shares.

Despite clearance, Google is still subject to SEC investigations surrounding the sale of 28 million unregistered shares to employees and consultants, as well as an article appearing in the September issue of Playboy magazine, which might constitute securities fraud.

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