Facebook CFO Increased IPO Shares

    A sign announcing Facebook IPO is flashed on a screen outside the NASDAQ stock exchange after the opening bell in Times Square in New York, May 18, 2012. Facebook is set to go public on May 18, 2012 and is likely to have an estimated market valuation of over 100 billion USD when its shares begin trading on the NASDAQ. AFP PHOTO/Emmanuel Dunand        (Photo credit should read EMMANUEL DUNAND/AFP/GettyImages)

    Emmanuel Dunand, AFP / Getty Images

    Facebook stock has been backsliding since the initial public offering last week, and now we may know why. It appears that less than 72 hours before the company went public CFO David Ebersman decided to increase the number of shares that would be offered by 25 percent after officials at Morgan Stanley assured the company that there would be plenty of demand. The stock was initially priced at $38 a share, but fell to $31 after trading on Tuesday. Still, in most respects, the IPO was a success, raising $16 billion for Facebook, which has been valued at $104 billion. Sources revealed Tuesday, however, that price slashing went on prior to the IPO, sparking regulator interest in the instance, which could face a more thorough federal probe.

    Read it at The Wall Street Journal