Google IPO in Doubt

Looks like Google may not be able to afford those 1.35 billion cokes, after all (see Tracking Google's IT Booty).

The search engine, which recently filed for an IPO, is running into trouble with the public offering, based on a new legal complication -- and a general lack of interest from investors, according to multiple sources around the investment community.

Google officials declined to comment for this story.

After all the hype and planning, is it possible that the Google IPO could become... ungoogled?

"It wouldn't surprise me," says Jay Somaney, of Plano, Texas-based TSG Capital. "I spoke to four different brokers. Nobody in their offices are writing retail tickets," he notes, meaning there has been little interest from the retail comunity to bid on the IPO. The brokerages he's referring to include Morgan Stanley and Goldman Sachs & Co."The market is falling apart -- who wants to pay $130 for an Internet stock?" asks another fund manager, who wishes to remain unnamed.

Other sources say Wall Street today was rife with rumors that the IPO is in trouble, and that the lack of interest -- and a problem with unregistered shares -- may force Google to refile at a later date.

Google's potentially IPO-killing problem stems from multiple roots:

With a successful IPO, Google stands to pocket approximately $1.5 billion -- with insiders taking another $1.5 billion or so -- which could promptly become a windfall for enterprise IT vendors, as we reported last week.

Whatever happens, it will be a hard reminder to all of us who've forgotten Business 101 lessons learned in the 90s: Google may be king this week, but common sense and profits will rule us all forever.

— Evan Koblentz, Senior Editor, Next-Gen Data Center Forum, and R. Scott Raynovich, US Editor, Light Reading