Here's a question I have: How may $50 billion companies with this kind of low float have engaged in this kind of massive unlock? How many companies worth this much have an effective float of only 50-75 million shares? When EBAY hit $50 million in market cap, it's float was, what, at least 5x this amount?
I'm not saying there may not have been agreements, "gentleman's agreements," as some have called them, but, really, what underwriters are going to risk $35 billion of their own capital? Even if ten of them, we're talking a risk of almost $3.5 billion each. And why do that if by not supporting this stock it can be purchased in bulk at 85-100, near IPO prices? What incentive is there for institutions not to allow this stock to crash short-term? If GOOG is going to be brought into the S&P, I'd think that they'd want GOOG at low, not high, prices when that happens, to limit the risk to the index.
The only way out I see is if GOOG forced employees not to sell. I'm not an expert here, but I imagine coercion in this respect would not be acceptable - especially because insiders have unloaded right before the unlock. |
