Google Talk Turns Ominous

Google gossip burned up the wires on Wall Street Thursday, as outsiders wondered when and whether the search company's long-awaited initial public offering would go through.

CNBC, which previously said Google's Dutch auction would launch next week, reported Thursday that it was being pushed back a week.

Citing "a person familiar with the matter," Dow Jones Newswires reported that the offering was being pushed back a week because of logistical problems related to bidding registration.

Meanwhile, investors tried to digest the meaning of a filing Google made Wednesday evening related to its previously disclosed improper issuance of certain shares over the past few years.

As TheStreet.com reported three months ago, the "rescission offer" issued Wednesday is an occasional but hardly devastating glitch that some companies run into on their way to going public.

But that didn't stop conspiracy theorists from speculating that the company would use the rescission offer as an excuse to postpone its offering amid what is looking like an increasingly inhospitable market for an Internet IPO.

One buy-sider, citing a sales contact at one of Google's lead underwriters -- though not someone with access to any comprehensive view of incoming orders -- spoke of little demand for the offering.

Certainly the Google IPO -- which once enjoyed the white-hot frenzy reminiscent of Netscape's 1995 offering -- has been suffering a backlash in recent weeks, with news stories containing vague, anecdotal skepticism about the attractiveness of the company, given its expected pricing range.

In addition to Wall Street's usual August doldrums, Google has to contend with what has been a generally disappointing second-quarter earnings season for Internet stocks, with companies such as Yahoo! (YHOO) and InterActiveCorp (IACI) falling short of expectations.

The buy-sider -- who spoke on condition of anonymity and, like other potential bidders, has an interest in talking down Google's share price -- speculated that Google, in the face of weak demand, could delay its offering, cut the number of shares being offered, and/or lower the expected price range for the shares -- though, admittedly, the prices of those shares ultimately will be decided by bidders.

If the offering is postponed, "God help the Internet stocks for the next week," said the buy-sider.

That said, the buy-sider added there is no shame in delaying an IPO, noting that both eBay (EBAY) and Goldman Sachs (GS), among others, were slow out of the gate.

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