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My biggest takeaways: - a goldman unit with a fiduciary duty to clients passed on the deal - a goldman unit without any such duty is doing the deal - gol
by klochner 16y ago
My biggest takeaways:
- a goldman unit with a fiduciary duty to clients passed on the deal
- a goldman unit without any such duty is doing the deal
- goldman will make money on the deal at almost any valuation (with the ipo)
- clients need another 20% appreciation to make money (break even at $60B)
- jdp23 16y agonice summary.
- palewery 16y agoIf the Stock goes down after an IPO, GS will wash their hands and blame FB management. If the stock goes up after the IPO, GS will take credit for "providing liquidity that was instrumental to FBs success"
- eftpotrm 16y agoAs soon as I heard this GS buy-in to Facebook, what came to mind? Pump and Dump. We can all see that Facebook's earnings don't justify a $50b valuation any time soon, so to buy in at that valuation looks like a very brave long-term investment. Yet GS have got huge publicity from the deal and, as long as they can sell a good number of their shares, they make money regardless - they win, their investors carry the can. This whole deal is no better than the spam stock tips I used to get every morning from some unknown address.
- trotsky 16y agoGoldman doesn't have to wait for the IPO to make money. According to a separate journal article they are charging their clients 4% and traditionally Facebook would pay 2%-4% on the deal. That comes out to $90M-$120M.