NASDAQ yesterday apologised for botching Facebook’s first day of trading as its $40m (£25.8m) compensation offering was approved by regulators.
Chief executive Robert Greifeld said the stock exchange “owes the industry an apology” for the technical problems that plagued Facebook’s Nasdaq debut on 18 May.
The tech-favourite bourse said it will offer $13.7m in cash to affected investors and the remainder in trading discounts to brokers.
But this figure is a drop in the ocean compared to the $115m-plus losses totted up by the top four market makers in Facebook’s IPO: UBS, Citigroup, Knight Capital and Citadel Securities.
“Disappointed” Knight Capital said Nasdaq’s efforts do “not come close to covering reported losses” and the called the compensation plans “simply unacceptable”.
Nasdaq’s rivals have also expressed discontent at the plan, with its main competitor NYSE Euronext saying: “This is tantamount to forcing the industry to subsidise Nasdaq’s missteps. We intend to strongly press our views that Nasdaq’s proposal cannot be allowed to permit an unjust and anti-competitive situation.”
Nasdaq’s announcement came during an unusually strong day of trading for Facebook, whose shares climbed 3.6 per cent to $26.81.
But the social network’s stock is still trading at just over two thirds of its $38 IPO price.