By Dan Primack
January 25, 2012

Facebook shares are still trading on secondary markets, despite suggestions to the contrary.

There is lots of talk this morning that Facebook’s IPO filing is imminent, based on a Bloomberg report that Facebook’s legal reps at Fenwick & West instituted a three-day “halt” on processing secondary trades of Facebook shares. The story says:

“While buy and sell orders can be made, transactions won’t be processed by Facebook’s attorneys at Fenwick & West LLC from [January 25] until Jan. 27, said the people, who declined to be named because details on secondary transactions are kept private. The halt pertains to trading of Facebook shares only, one of the people said… ”

Bloomberg got “no comments” from Facebook, Fenwick & West, SecondMarket and SharesPost.

What’s important to know, however, is that this isn’t the first time Fenwick & West has temporarily suspended trading in Facebook shares. I’m told that it’s done so on multiple occasions in the past, and is telling market participants that the current move is so that it can conduct “shareholder record audits.” Maybe it’s a ruse, but obviously Facebook didn’t file its S-1 during previous trade suspensions.

Moreover, remember that while the Bloomberg headline is “Facebook trades to be halted for three days,” the actual story says, trades themselves are ongoing. SecondMarket, for example, is in the midst of a Facebook share auction right now. And SharesPost just announced that one concluded. The “halt” refers to actual closings of new transactions – which is what Fenwick & West is charged with signing off on.

Everyone seems to expect a Facebook IPO filing within the next couple of months, and it certainly could come within this three-day period. But the Fenwick & West move, alone, shouldn’t lead anyone to draw that conclusion.

Sign up for my daily email newsletter on deals and deal-makers: GetTermSheet.com

You May Like

EDIT POST