Facebook Inc. (NASDAQ:FB) is in so much of a hurry to close its deal to buy Instagram that it is using a California law to work around the regulators at the Securities and Exchange Commission (SEC), while the FTC is still looking into the deal. According to the San Francisco Chronicle, California has a law that allows companies to issue shares without first seeking SEC approval.
Facebook Inc. (NASDAQ:FB) CEO Mark Zuckerberg signed off in May to buy Instagram for 23 million shares, or about $300 million. Once Facebook held its IPO, the price went up to just shy of $950 million, give or take a few million. Now it seems, with the value of the stock depreciating by nearly 50 percent since May, Facebook wants to get those shares out into the markets as quickly as possible, and with the FTC investigating and the SEC not signing off until the FTC does, Zuckerberg apparently figured he can’t wait any longer or the deal will go south.
Facebook Inc. (NASDAQ:FB) has a hearing August 29 before the California Department of Corporations to seek the state’s approval to skirt around the SEC and issue shares before the SEC signs off. Regulators in the United Kingdom have already OK’d the deal, but the FTC just sent a second request for information to Facebook Inc. (NASDAQ:FB).
Getting this deal done is likely very important for the future of Facebook Inc. (NASDAQ:FB) stock, which has not been played by very many hedge-fund investors. However, George Soros of Soros Fund Management did recently purchase a stake in Facebook Inc. (NASDAQ:FB).