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The Boston Globe

Business

Facebook adds 3 banks for initial public offering

NEW YORK - Facebook Inc. hired Deutsche Bank AG, Credit Suisse Group AG, and Citigroup Inc. to work on its $5 billion initial public offering and give it access to more credit, a person with direct knowledge of the situation said.

Facebook’s new and existing banks will grant the company an additional credit line of more than $2.5 billion, said the person, who declined to be identified because the decision isn’t public. Morgan Stanley, JPMorgan Chase & Co., Goldman Sachs Group Inc., Bank of America Corp., Barclays PLC, and Allen & Co. were previously hired on the IPO.

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The move would give the social network a pipeline of more than $5 billion in possible borrowings. That compares with a $3 billion credit line for Google Inc., the most valuable US Internet company. While going public with debt is unusual for a Web company, the move may not damp demand for Facebook shares, said Sameet Sinha, an analyst at B. Riley & Co.

“The demand for Facebook’s stock is going to be so high that I think most investors are just going to overlook this aspect,’’ said Sinha.

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