Zynga announces release of a-level stock lock periodic limit

According to foreign media reports, Zynga, the world's largest social gaming service provider, announced in Monday that Morgan Stanley and Goldman Sachs, the joint underwriter of the company's IPO, and vice-underwriters, had agreed to release periodic limits on a-level stock lock held by company-specific executives and directors. Enable them to sell their holdings in the two recently announced releases.

Zynga reported to the Securities and Exchange Commission on March 14 that it would allow existing investors to sell some of their holdings through a secondary release, while allowing large shareholders to support longer "lock-up periods" so that they could not sell their holdings in "lock-time". Zynga's two-time release was designed to avoid the same fate as LinkedIn. The company's share price fell sharply after LinkedIn closed its lock-up period last November. Typically, companies will ban large shareholders from selling their shares within 6 months after listing.

In a paper submitted to the Securities and Exchange Commission in Friday, Zynga said its shareholders would sell 43 million shares in a second issue. Based on the closing price of the 13.76 US dollar in Thursday, the second issue of A shares will raise $591 million. Zynga last December made an initial public offering, raising 1 billion of billions of dollars. Zynga also said that after the second release, the company chief Executive Mark Ping Cass (Mark Pincus) will be reduced from 36.5% to 35.9%. In addition to company-specific executives and directors, private-equity firms Kleiner Perkins Caufield & Byers and Union Square Ventures will also sell some shares in a secondary release.

Morgan Stanley and Goldman Sachs are the joint underwriter of Zynga's initial public offering, which includes Bank of America AG/Merrill Lynch, Barclays Capital, JPMorgan Chase and Allen & Company.

Zynga mainly receives revenue by selling virtual goods in games. The company's previous earnings showed revenues of $311.2 million trillion in the fourth quarter of last year, up 59% from a year earlier, more than the average estimated $301.1 million trillion by market analysts. Without the US GAAP, Zynga's earnings per share in the fourth quarter amounted to $0.05 trillion, surpassing expectations of an average of $0.03 trillion by market analysts. Zynga's fourth-quarter net loss to shareholders in the company's tradable shares was USD 435 million, with a loss of $1.22 per share. The company's net profit for the same period last year was 16.1 million dollars, 5 cents per share. The main reason for Zynga's fourth-quarter results was that it counted 510 million dollars in equity incentive payments allocated to employees. Zynga's fourth-quarter virtual goods sales totaled $306.5 million trillion, up 26% from a year earlier. Zynga expects 2012 total sales of virtual goods to be $1.35 billion trillion to $1.45 billion trillion.