Facebook Inc added several women- and minority-owned investment banks to the roster of underwriters for its initial public offering, following in the footsteps of General Motors Co and Goldman Sachs Group Inc, which did the same during their own offerings.
The No. 1 online social media network, which filed an amended IPO registration statement with the U.S. Securities and Exchange Commission on Wednesday, has hired 31 banks as underwriters for its $5 billion IPO, expected to value the company at up to $100 billion
Among the women- and minority-owned firms included in the deal are New York-based banks CastleOak Securities, Williams Capital Group and M.R. Beal & Co, and Chicago-based Loop Capital Markets.
"Wall Street tries to do what looks good on high-profile IPOs, and it will not go unnoticed that Facebook has chosen to bring in minority underwriters," said Scott Sweet, senior managing partner at IPO Boutique.
"It's not going to make or break the deal, but it will show that they're not nonchalant about the opportunities that smaller firms can offer distribution-wise."
Facebook did not respond to a request for comment.
The addition of these firms comes after Facebook was criticized by the California State Teachers' Retirement System for not including women on its board of directors.
CalSTRS, the second largest pension fund in the United States, holds some ownership in Facebook and expects to be a public shareholder.
In Facebook and other IPOs, these firms are only getting joint bookrunner positions, with the large Wall Street banks taking the lead spots.
Women- and minority-owned investment banks have been underwriting more equity deals in recent years. They helped underwrite 20 IPOs in 2011 that raised $1.5 billion, almost double the amount raised in 2007, according to data from Thomson Reuters.
In 2010 Congresswoman Maxine Waters, a Democrat from California, spoke out against General Motors' decision not to include any underwriters from minority- or women-owned financial institutions. The Detroit automaker eventually added a handful of these banks as underwriters.
Goldman Sachs also gave boutique firms Utendahl Capital Partners and Muriel Siebert & Co a more lucrative position in its IPO after discussions with civil rights activist Rev. Jesse Jackson, according to a 1999 report from the Associated Press.
Jackson had been pushing for minority businesses to have more of a presence on Wall Street. Goldman declined to comment.