After some of the IPOs we have seen in recent days, it is no wonder that some investors are scared to play in the realm of IPOs. Now there is a new poor man’s IPO that is taking a bite out of investors. FriendFinder Networks Inc. (NASDAQ: FFN) just managed to hurt a whole slew of investors today in its Initial Public Offering.
The owner of adult-themed social networking websites, a.k.a. p-o-r-n, sold 5 million shares today at a price of $10.00. We previously had seen that the company was going to sell 5 million shares in a range of $10.00 to $12.00 per share. The pig was already priced at the low-end of its range. When it first tried to do an IPO back in 2008, the company sought to raise up to $460 million. Now that $460 million is worth more than the entire market cap.
Today’s joint book-runners of the offering were listed as Imperial Capital and Ladenburg Thalmann. Now they probably have some irritated clients. They certainly just gave one more bit of caution to an IPO market that was already getting a bit paranoid.
The opening price per Yahoo! is listed as being $9.99 and the day’s range is $7.23 to $10.01. Just before 2:30 PM EST we have shares trading down at $7.61 and there have barely been 2,000,000 shares traded.
With the whole slew of adult websites that FriendFinder has in its stable, we won’t even bother making up any more fake names… save one or two. FriendFinder just became EnemyFinder for IPO investors. Actually, maybe it is EnemaFinder.
There are some brokers with clients out there today that probably wished they never heard the combined themes ‘social networking’ and ‘adult entertainment’ in the same sentence. Calling your clients to explain a sudden 20% loss has never fun. It will be pretty hard for the company and the underwriters to pin a crummy IPO like this on the volatility of currencies and commodities.
JON C. OGG
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