The Nasdaq plans to give $40 million to the Facebook investors who lost money when the stock exchange suffered a technical malfunction on May 18, delaying the social network’s IPO.
Yesterday, the Wall Street Journal reported that the Nasdaq had made its first steps toward offering this kind of reimbursement. The stock exchange is submitting today’s plan to the Securities and Exchange Commission, which will make a decision on whether or not the plan is reasonable. The $40 million will be made up of its own Facebook IPO profit of $10.7 million, $3 million regularly held for these types of situations, and trading discounts.
Facebook went public on May 18, but the opening was delayed by a half hour when Nasdaq’s computer systems had difficulties. Because of this delay, investors who had submitted trades at the assumed opening were left waiting for hours to know if their trades had been successful. Overall, investors are claiming $100 million in loss. It’s rumored the social networks is now considering a switch from the Nasdaq to the New York Stock Exchange.
According to the Dow Jones Newswire, the Financial Industry Regulatory Authority will be looking at all of the loss-claims, but will let the Nasdaq decide who will receive a portion of the $40 million. The exchange is currently interested in those who made trades at $42 that were delayed and didn’t sell at that price.
Facebook’s stock has taken a beating since its delayed IPO, though the Nasdaq is far from the only problem. The social network is also being sued by investors for not telling potential investors that some of the underwriters “reduced their second quarter and full year 2012 performance estimates.”
via Dow Jones Newswire; image via Facebook’s IPO livestream