Tech investor, Roger McNamee has come out saying that Nasdaq and Morgan Stanley are completely to blame for Facebook’s IPO troubles.
“NASDAQ’s behaviour on this, in my mind, borders on criminal. I think Morgan Stanley’s behaviour borders on criminal… this was clearly done on purpose,” he said to Bloomberg TV.
“You watch what all of these people have been doing in secondary markets. Do you think it is a coincidence that every secondary offering trades down five or six days before the offering? Then they price it down 15%, and then it pops? It sure looks to me like the underwriters are shorting the stocks. What I am saying is I look at all of this and as a 30-year investor, I think people on Wall Street have just so totally lost track of honesty…. it is staggering.”
McNamee pinpointed the problematic management of the social network’s stock market debut.
“Let’s say for example there are 25 things you have to get right on an IPO. They blew at least 24 of them… So, NASDAQ clearly is at fault for not cancelling and postponing the offering. And, Morgan Stanley is at fault for increasing the size of the deal and price with a complete absence of demand,” he said.
McNamee was one of Facebook’s early advisors and currently runs Elevation Partners, a private equity firm he co-founded with Bono of U2.