Bloomberg reports:
‘Sept. 14 (Bloomberg) -- Google Inc., the most-used Internet search engine, may raise $4.41 billion today in its first stock sale since going public, the largest such offering in more than 10 years.
The sale will allow Google to bolster its cash reserves to compete with Yahoo! Inc. and Microsoft Corp. for Internet users and advertisers.’
I don’t know what to think about it: firstly, the launch of Google Blog Search today (hyped all over) is probably not bad the day before this. Secondly, as far as I remember from business school, the simple rule of finance is that you sell high and buy low.
Therefore, isn’t Google (see section ‘market signaling’ in your finance book) selling equity now on capital markets because it’s over-priced ? I guess not, since all those MBA-educated traders out there have moved the price from less than $300/share to more than $310 in 2 days 
Later in this report we read:
“Google's offering would be the biggest secondary share sale in the U.S. since at least 1995, according to David Menlow, who runs IPOFinancial.com. The sale would surpass the $3.99 billion secondary offering by Goldman Sachs Group Inc. in 2000. In its first offering, Google raised $1.67 billion selling 19.6 million shares for $85 in an auction in August 2004.
``They have deep-pocketed competitors,'' said Marianne Wolk, a Susquehanna Financial Group analyst in New York. ``It's clearly a race of companies with ample resources, and Google wants to be in the race.'' Google has $2.95 billion in cash and short-term investments, compared with Redmond, Washington-based Microsoft's $37.8 billion and Sunnyvale, California-based Yahoo's $3.39 billion.” […]
“ ``To raise twice as much capital at almost four times the offering price, it's pretty compelling,'' said Scott Devitt, an analyst at Legg Mason Wood Walker in Baltimore. ”
Indeed.
Now playing: commandN - commandN Episode 9
