Updated from 1:08 p.m. Google filed Monday to list its shares on the Nasdaq Stock Market, ending months of speculation about where the hot search engine company's stock will trade once it comes public. The company said in a filing with the Securities and Exchange Commission that it would seek to list its shares on Nasdaq, which has long enjoyed favored status with Silicon Valley. The company didn't say how many shares it would sell or when, or what its ticker symbol would be. In the Monday filing, which marks the third amendment to the public offering document that
Google first filed April 29, the company also supplied more details about the nontraditional auction process it will be using to distribute its shares. In the new filing, Google raised the possibility that bidders will have to reconfirm their bids to keep their spot in the auction. The company even added a bit of boilerplate to its offering document, a perfunctory nod explaining why it is going through with the IPO in the first place. Even before Google filed for its $2.7 billion public offering, the IPO already ranked among Wall Street's most eagerly anticipated deals. In its original filing, the company said it would list either on the Nasdaq or on the rival New York Stock Exchange. While the Nasdaq has for years been the public market incubator of most technology firms, the NYSE has been eager to gain big technology stock listings. But, confounding the NYSE's efforts to gain a greater foothold among listed technology companies, many of the great tech success stories of recent years, from Microsoft ( MSFT) and Intel ( INTC) to Yahoo! ( YHOO) and Cisco ( CSCO), have maintained their Nasdaq listings even after they attained blue-chip status. In its latest filing, updating an earlier amendment filed at the SEC on June 21, Google says it may require bidders to reconfirm their bids under two possible conditions: if more than 15 business days have elapsed since the bidder submitted his or her bid, or if there is "a material change" in Google's prospectus that requires it to be recirculated.
If either condition occurs, Google says it will send an electronic notice to all registered bidders asking them to reconfirm their bids with their broker. If the bidders don't reconfirm, says Google, "we and the underwriters will disregard their bids in the auction." If, before the SEC declares Google's registration statement effective, Google changes the price range or the number of shares to be sold in its offering, the company plans to issue a relevant press release and notify bidders electronically. In such a case, says Google, individual underwriters may require a reconfirmation. In another change to the auction process, Google cut out language in the July 21 amendment that indicated that Google would notify bidders of the proposed date that its offering becomes effective. Now, it appears, Google is making no representations that it will give bidder's a head's-up warning on any expected SEC approval. In the latest filing, Google also gave a sliver of insight into the possible effect of one of the company's options in the auction process: setting a price for the company's shares that isn't the highest possible price at which it could sell those shares based on the bids in its master order book. As the company has pointed out already, setting its shares lower than the highest possible price could help the company distribute its shares more broadly. This time around, the company also points out that setting a lower price "may result in less downward price volatility in the trading price" for its stock "in the period shortly following our offering." In other words, the company appears to subscribe to the reasonable belief that the lower the price is, the less it is likely to fall as the initial buzz of the IPO lessens. While supplying more information about auction process, Google gave a new indication that it isn't exactly straying from its tendency toward secrecy.
As it has previously, the company gave two detailed illustrations of how it may allocate its shares to bidders if the number of qualified bids for Google's stock exceeds the number of shares available for sale. In one hypothetical example, successful bidders -- that is, those whose bidding price equals or exceeds the price at which Google ultimately decides to sell its shares -- would all receive the same percentage of of shares that they requested, no matter how many shares they had offered to buy. In another example from Google, smaller shareholders would receive the full number of shares they requested, while other "tiers" of shareholders who bid on larger amounts of shares would receive only a fraction of the shares they hoped to buy. Despite the lengthy explanation of these alternatives, in its latest filing, Google suggests it is not interested in discussing the matter further. Perhaps in an effort to minimize gaming of the auction process, the company now says, "We do not intend to publicly disclose the allocation method that we ultimately employ." Finally, Google added some nondescript language to its IPO that formally stated why the company is going public. "The principal purposes of this offering are to obtain additional capital, to create a public market for our common stock and to facilitate our future access to the public equity markets," says the company. Whatever Google's motives, investors have been keen to see the company come public. The search engine business is among the fastest-growing on the Internet, and the rise of Google could threaten big rivals such as Yahoo! and Microsoft, as well as smaller players like AskJeeves ( ASKJ) and FindWhat ( FWHT).