WEST PALM BEACH, FL (HEDGECO.NET) – Google has made many enemies in the process of making its IPO available for stock market participants. In the past few weeks, the company has attracted substantialnegative publicity that has also translated to anger for some individuals and companies. Varlin Zapata, who manages Shortpicks .com, said that while he would not advise anyone to short sell theGoogle IPO, he would however take notice that the IPO will be “released during red markets, that may help to increase the selling pressure after the IPO.\u00c3\u00af\u00c2\u00bf\u00c2\u00bd<\/p>\n
Another manager, Scott Rothbort, president of Lakeview Asset Management, said “I know a lot of hedge funds that are salivating at the opportunity to short Google,\u00c3\u00af\u00c2\u00bf\u00c2\u00bd no one is sure how the Google stock will perform once market trading begins. Zapata said that those who are upset with Google happen to work on the other side of Wall Street, and many investment banks are not happy with Google.<\/p>\n
Part of the problem is that Google Management decided to go with the \u00c3\u00af\u00c2\u00bf\u00c2\u00bdDutch auction\u00c3\u00af\u00c2\u00bf\u00c2\u00bd plan, which tends to put the company at loggerheads with the investment banking establishments. Another problem is that many banks wont get big cuts in fees, and limited number of shares will be made available to them, thus eliminating opportunities for these establishments to profit from this process.<\/p>\n
Patrick Byrne, CEO of Overstock.com, said, “There’s a backlash from the Street — a well-orchestrated campaign against Google — and it’s insidious,” according to him. Byrne\u00c3\u00af\u00c2\u00bf\u00c2\u00bds company used the \u00c3\u00af\u00c2\u00bf\u00c2\u00bdDutch auction\u00c3\u00af\u00c2\u00bf\u00c2\u00bd plan for its IPO when the company went public in 2002, and according to him,, “We were warned by big banks that if we [went public via Dutch auction], there’d be retaliation. Most said no one would ever talk to us, or pick up coverage. They’ve been true to their word on that.”<\/p>\n
Some market analysts think there is huge interest however in the Google IPO, partly because of the size of the company, and some of this anger against the company IPO may be unwarranted..<\/p>\n
Paul Oranika
Editor-in-Chief
HedgeCo.Net
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