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Facebook shares drop as lock-up period expires

  • Facebook shares shed nearly 4 percent at the end of a busy trading day on Wednesday as the company allowed employees to start selling around 230 million shares less than six months after its market debut.

    The world's biggest social network waived a provision that prevented employees from selling shares until November 14.

    The move resulted in shares worth around $5 billion at current prices eligible for sale on the public market.

    Facebook employees were due to be able to sell their shares on Monday but the two-day market closure due to storm Sandy saw Wednesday become the first trading day.

    More than 1 billion Facebook shares held by employees, insiders and early investors are due to become available for trading by the end of the year, a significant rise from the flotation of roughly 692 million shares that were available for trading as of September 30.

    The largest batch of additional shares will be eligible to trade on November 14, when the lock-up expires on some 800 million shares.

    Facebook's stock dropped 3.7 percent to end the day at $21.14 in Wednesday trading.