Facebook deal publicity limits offering

Goldman Sachs is set to exclude its US clients from a private offering of Facebook shares due to “intense media coverage” which could lead to the bank breaching US security laws.

Earlier this month Goldman Sachs invested $450m in the social network which valued Facebook at $50bn (£32bn).

It was then reported Goldman Sachs was looking to raise a further $1.5bn for Facebook through private placement of shares for its top clients. Instead, investors from outside the US, including clients in the UK, will be included in this investment round.

The bank said the high level of publicity the investment plan had generated could breach US regulations surrounding promotion of private placement.

Under a US Securities and Exchange Commission (SEC) rule, private placement cannot be the subject of advertising, promotional seminars or public meetings in connection with the offering. Rules outside the US are less strict regarding publicity surrounding private placement.

The absence of US investors is not expected to hinder the overall fundraising plan, which is already up to three times oversubscribed according to reports.


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