Goldman To Close Books For GM IPO Allocation On Friday, Three Days Ahead Of Pricing
An interesting development for the biggest market event of the year for US capital markets, the GM IPO, which is supposed to start trading next Thursday (why else would Brian Sach have a POMO every day next week) is the news out of Dow Jones that Goldman Sachs will close its books for GM share allocation on Friday at noon. Dow Jones takes this as an indication of massive demand. Perhaps, although with Goldman third row in the bracket, below MS, JPM, BofA, Citi, Barclays, Credit Suisse and Deutsche, they hardly had a big allocation to fill. More likely, this is merely a way to snub the government and demonstrate that unlike the other banks (none of whom are closing books early) it has done its job the fastest and the most efficient. That said, should Brian Sack not be able to contain the suddenly very jittery market, we would not be too surprised to see someone pulling the "market conditions" cop out card over the next week.
From Dow Jones:
Investment bank Goldman Sachs Group Inc. (GS) will stop taking orders for General Motors Co.'s IPO Friday at noon, according to an analyst, an early sign of high demand for the deal three-and-a-half business days before it is expected to begin trading.
Although initial public offerings that generate strong investor response sometimes fill all orders a day or two ahead of pricing, Goldman's decision to stop taking orders so far ahead of the stock's debut is somewhat unusual, said Scott Sweet, managing director of research firm IPOBoutique.com. General Motors' stock is scheduled to begin trading next Thursday.
Sweet said Goldman is the only underwriter so far that has indicated plans to stop accepting orders that far ahead of pricing.
Goldman Sachs wasn't immediately able to comment; a spokesman for General Motors declined to comment.
Goldman is one of 35 underwriters participating in marketing GM's stock to investors, but it is not a lead bookrunner on the deal. Its lower profile on the offering means that the amount of shares it can allocate to clients is smaller than lead banks like Morgan Stanley (MS) and JPMorgan Chase & Co. (JPM).