Google lowers share price

The company will sell less than half the shares originally planned.
SAN JOSE, Calif. (AP) -- In a sign that Google Inc.'s initial public offering will not be as hot or big as expected, the Internet search giant said it had lowered its estimated price range to between $85 and $95 per share, down from its earlier forecast of between $108 and $135 per share.
The company also said the number of shares available to the public will be lowered as shareholders will sell only 5.5 million shares, less than half of the 11.6 million originally planned. The company itself will sell 14.1 million shares, which is unchanged.
That means a total of 19.6 million shares will be available, a decrease of about 6.1 million shares. The action should help support the per-share price because the overall supply of shares has decreased.
Share size
The lower pricing affects the size of the offering. Instead of raising up to $3.6 billion, it will generate $1.86 billion if the IPO price is set at the new high-end of $95. And Google's market capitalization at $95 a share will be less than $26 billion, down from $36 billion.
Google sent e-mail notices just before midnight Tuesday to people who had registered to bid in its unusual auction that will determine the ultimate IPO price. The message also was posted to its Web site and confirmed by Google spokeswoman Cindy McCaffrey.
She declined to comment further.
Unsure
Some observers have questioned whether Google's triple-digit price estimate could be maintained, especially given the rocky stock market conditions in recent weeks. Several companies, in fact, have delayed or abandoned plans to go public.
Google said it will file amended paperwork Wednesday with the Securities and Exchange Commission. On Tuesday, the regulatory agency did not grant Google's request and give final approval of its registration, which is required before any stock is publicly sold.
It was not immediately clear whether the SEC delay was related to Google's price estimate downgrade, though Google's statement said it and its underwriters have again requested that its registration document be made effective -- this time at 4 p.m. EDT.
The final IPO price that investors will pay is being determined by an unusual auction that opened Friday.
"Google and the underwriters expect to close the auction when the registration statement is declared effective," according to Google's e-mail.
Copyright 2004 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.