Slashdot Mirror

← Back to Stories (view on slashdot.org)

Google IPO Problems Surface

Posted by michael on from the here-come-the-lawsuits dept.

manavendra writes "The BBC is reporting that Google has admitted it may have breached stock market laws in the US, while CNET says Google may have run afoul of securities laws when it doled out millions of shares to employees and consultants over the past three years, according to a document filed Wednesday with the Securities and Exchange Commission."

4 of 235 comments (clear)

  1. It's not going to cost them that much... by garcia · · Score: 5, Informative

    This isn't huge news or anything. They found the mistake, theya re going to buy back the shares, it's going to cost about 25 million to buy the shares back.

    25 million out of their on-hand cash reserves isn't that much.

    1. Re:It's not going to cost them that much... by Undertaker43017 · · Score: 5, Informative

      Which is why, I suspect, most people won't take them up on their offer. The article states any shares not sold back to the company will be registered, and then tradable. So it may cost them less than $25 million, provided no one sues, which I'm sure someone will....

  2. Google's SEC fililng by ecklesweb · · Score: 5, Informative

    No that anyone RTFA, much less supplemental information, but for historical purposes here's a link to the specific document in the Google SEC filing that talks about the "recission offer":

    Form S-1 Registration Statement

    This section in particular is a good summary of what they did.

  3. Only if they accept the rescission offer by Mr.+Sane · · Score: 5, Informative

    To put it simply: When a company has a unregistered private share offering to non-qualified investors (essentially non-high net worth, or "unsophisticated investors") they are required to get a waiver from the "unsophisticated investor" that they are willing to participate in the risk of investing in an unregistered offering.

    The risk is that there are not the same corporate disclosure requirements for unregistered offerings as there are for registered offerings.

    In the event that the company wants to go public at a later date, they usually provide rescission offers to these investors, which allow them to cash before the risky public offering.

    Most rescission offers are optional, and in the event that the investor declines they will sign an additional waiver that says they are going along for the ride.