Google’s IPO delayed

  • Associated Press
  • Tuesday, August 17, 2004 9:00pm
  • Business

SAN JOSE, Calif. – Google Inc.’s long-awaited initial stock sale, which appeared imminent Tuesday, has been delayed while the company awaits final approval of its paperwork by the Securities and Exchange Commission.

Regulators made no decision Tuesday as Google had requested, said John Heine, an SEC spokesman. He declined to provide a reason for the delay.

Google did not immediately return a call seeking comment.

The company has updated its regulatory filings several times since first announcing its plans to go public in April, including an update on Monday that stated the SEC was investigating its issue of pre-IPO shares and options without registering them.

Typically, companies work closely with the SEC to ensure all paperwork is in order, making final approval a routine process.

Google had planned to close its share price-setting auction no earlier than an hour after receiving the SEC’s blessings. If that had happened, winning bidders could have been notified and shares could have been traded on the Nasdaq Stock Market as early as Wednesday.

Google anticipates its 25.7 million shares will be priced between $108 and $135 each in what could be a $3 billion initial public offering, which would be a record for an Internet company. If the stock trades at the midpoint of Google’s range, it would have a market capitalization of about $30 billion – lower than Yahoo Inc.’s but above General Motors Corp.

The deal would turn Google’s 30-something co-founders Larry Page and Sergey Brin into billionaires and create a windfall for the search company’s early investors and 2,292 employees who are expected to sell at market prices shares they bought for as little as 30 cents each.

Insiders flooding the market combined with strong demand from outside investors could lead to surprises when the stock finally debuts.

Then again, that’s nothing new for Google.

Since it was founded in 1998 by Stanford University students Page and Brin, it has always been something of an oddball. Its design eschewed flashy ads for a simple, quick-loading layout. Its search algorithm out-powered all rivals. Its name became synonymous with Internet search.

The Mountain View-based company, which makes money by selling unintrusive text advertising, managed to prosper as a private company even while other dot-coms were collapsing. Now, as the technology industry is just recovering, Google stands to prosper even more.

In the second quarter of this year, for instance, Google earned $79.1 million, or 30 cents per share, compared with $32.2 million, or 12 cents per share, in the same period last year. Sales more than doubled, to $700 million in the latest period from $311 million last year.

But its surprising success pales in comparison to the roller coaster ride that’s taken place since Google announced in April that it planned to make its stock available to the public.

The four-month saga that has included Google’s unusual IPO auction to set price based on demand, folksy letters embedded in filings, a Playboy magazine interview of its founders despite a quiet period and the discovery that the company neglected to register millions of shares.

The auction was designed to democratize the IPO process, which is usually limited to investors connected to investment banks. Still, many analysts questioned whether Google’s projected price was affordable to average investors.

Google’s prospectus not only included the usual bureaucratic language and charts, but also a folksy letter from its founders. The document contained more than 20 pages of warnings, ranging from competition and potential technical problems to gaffes like the Page and Brin interview that appeared in Playboy magazine during the company’s so-called quiet period.

One of the more serious disclosures was the fact that Google neglected to register 23 million shares and 5.6 million options. They were issued from September 2001 through July 2004, primarily to employees and consultants.

Associated Press

Google co-founders Larry Page (left) and Sergey Brin are waiting for final approval for its highly anticipated initial public offering from Securities and Exchange Commission regulators. Google’s 25.7 million shares will be priced up to $135 each.

Talk to us

> Give us your news tips.

> Send us a letter to the editor.

> More Herald contact information.

More in Business

A closing sign hangs above the entrance of the Big Lots at Evergreen and Madison on Monday, July 22, 2024, in Everett, Washington. (Ryan Berry / The Herald)
Big Lots announces it will shutter Everett and Lynnwood stores

The Marysville store will remain open for now. The retailer reported declining sales in the first quarter of the year.

George Montemor poses for a photo in front of his office in Lynnwood, Washington on Tuesday, July 30, 2024.  (Annie Barker / The Herald)
Despite high mortgage rates, Snohomish County home market still competitive

Snohomish County homes priced from $550K to $850K are pulling in multiple offers and selling quickly.

Henry M. Jackson High School’s robotic team, Jack in the Bot, shake hands at the 2024 Indiana Robotics Invitational.(Henry M. Jackson High School)
Mill Creek robotics team — Jack in the Bot — wins big

Henry M. Jackson High School students took first place at the Indiana Robotic Invitational for the second year in a row.

The computer science and robotics and artificial intelligence department faculty includes (left to right) faculty department head Allison Obourn; Dean Carey Schroyer; Ishaani Priyadarshini; ROBAI department head Sirine Maalej and Charlene Lugli. PHOTO: Arutyun Sargsyan / Edmonds College.
Edmonds College to offer 2 new four-year degree programs

The college is accepting applications for bachelor programs in computer science as well as robotics and artificial intelligence.

FILE — Boeing 737 MAX8 airplanes on the assembly line at the Boeing plant in Renton, Wash., on March 27, 2019. Boeing said on Wednesday, Feb. 21, 2024, that it was shaking up the leadership in its commercial airplanes unit after a harrowing incident last month during which a piece fell off a 737 Max 9 jet in flight. (Ruth Fremson/The New York Times)
Federal judge rejects Boeing’s guilty plea related to 737 Max crashes

The plea agreement included a fine of up to $487 million and three years of probation.

Neetha Hsu practices a command with Marley, left, and Andie Holsten practices with Oshie, right, during a puppy training class at The Everett Zoom Room in Everett, Washington on Wednesday, July 3, 2024. (Annie Barker / The Herald)
Tricks of the trade: New Everett dog training gym is a people-pleaser

Everett Zoom Room offers training for puppies, dogs and their owners: “We don’t train dogs, we train the people who love them.”

Andy Bronson/ The Herald 

Everett mayor Ray Stephenson looks over the city on Tuesday, Jan. 5, 2015 in Everett, Wa. Stephanson sees  Utah’s “housing first” model – dealing with homelessness first before tackling related issues – is one Everett and Snohomish County should adopt.

Local:issuesStephanson

Shot on: 1/5/16
Economic Alliance taps former Everett mayor as CEO

Ray Stephanson will serve as the interim leader of the Snohomish County group.

Molbak's Garden + Home in Woodinville, Washington will close on Jan. 28. (Photo courtesy of Molbak's)
After tumultuous year, Molbak’s is being demolished in Woodinville

The beloved garden store closed in January. And a fundraising initiative to revitalize the space fell short.

Everett Mayor Cassie Franklin, Advanced Manufacturing Skills Center executive director Larry Cluphf, Boeing Director of manufacturing and safety Cameron Myers, Edmonds College President Amit Singh, U.S. Rep. Rick Larsen, and Snohomish County Executive Dave Somers participate in a ribbon-cutting ceremony on Tuesday, July 2 celebrating the opening of a new fuselage training lab at Paine Field. Credit: Arutyun Sargsyan / Edmonds College
‘Magic happens’: Paine Field aerospace center dedicates new hands-on lab

Last month, Edmonds College officials cut the ribbon on a new training lab — a section of a 12-ton Boeing 767 tanker.

Gov. Jay Inslee presents CEO Fredrik Hellstrom with the Swedish flag during a grand opening ceremony for Sweden-based Echandia on Tuesday, July 30, 2024, in Marysville, Washington. (Ryan Berry / The Herald)
Swedish battery maker opens first U.S. facility in Marysville

Echandia’s marine battery systems power everything from tug boats to passenger and car ferries.

Helion Energy CEO and co-founder David Kirtley talks to Governor Jay Inslee about Trenta, Helion’s 6th fusion prototype, during a tour of their facility on Tuesday, July 9, 2024 in Everett, Washington. (Olivia Vanni / The Herald)
State grants Everett-based Helion a fusion energy license

The permit allows Helion to use radioactive materials to operate the company’s fusion generator.

People walk past the new J.sweets storefront in Alderwood Mall on Thursday, July 25, 2024, in Lynnwood, Washington. (Olivia Vanni / The Herald)
New Japanese-style sweets shop to open in Lynnwood

J. Sweets, offering traditional Japanese and western style treats opens, could open by early August at the Alderwood mall.

Support local journalism

If you value local news, make a gift now to support the trusted journalism you get in The Daily Herald. Donations processed in this system are not tax deductible.