UPDATE 1-Facebook to close IPO books two days early -source

Mon May 14, 2012 6:28pm EDT

By Olivia Oran

NEW YORK May 14 (Reuters) - Facebook Inc will close the books on its $10.6 billion initial public offering on Tuesday, two days ahead of schedule and a signal that Silicon Valley's largest IPO is drumming up strong demand, according to a source familiar with the deal.

The No. 1 social network is scheduled on Thursday to price its shares, then begin trading on Friday. The IPO is already "well oversubscribed," which is why the social network is closing its books earlier than anticipated, the source said.

No decision has been made about raising the proposed offer price for Facebook shares, which are being offered at $28 to $35 each, said the source, who asked not to be identified because discussions with the company are private.

If the price range is increased, it will likely be done after final orders come in Tuesday. Given the size of the IPO, the deal's underwriters are likely to be very cautious about raising the price range, the source said.

If Facebook's underwriters choose to raise the deal's price range more than 20 percent, the company will need to file an amendment with the Securities and Exchange Commission.

Company spokesman Jonny Thaw declined to comment on Monday.

Facebook will continue with its roadshow for the rest of the week, said a second source familiar with the deal, and investors who haven't yet attended a roadshow presentation will still be able to place orders.

Company executives met with prospective investors in Chicago on Monday and are slated to travel to Kansas City and Denver, before returning to Menlo Park, California, where Facebook is headquartered.

The IPO comes amid concerns from some investors that Facebook hasn't yet figured out a way to make money from an increasing number of users who access the social network on mobile devices such as smartphones.

A host of Wall Street banks are underwriting Facebook's offering, with Morgan Stanley, JPMorgan and Goldman Sachs serving as leads. Facebook will trade on Nasdaq under the symbol FB.

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