KAYAK, the online travel service, is said to be delaying its stock market flotation in America following Facebook's disastrous initial public offering.
Kayak has postponed the roadshow for the offering, which was scheduled to start last week, according to Bloomberg. Morgan Stanley, the lead bank on Facebook’s initial share sale, was also hired to lead Kayak’s IPO.
The US business was seeking to raise $150m in a June IPO but analysts it is unlikely to go ahead as planned.
The news came as Facebook shares tumbled for a third straight day to $27.88. The shares have now fallen by more than $10 from its initial price of $38 in what some analysts have branded the "worst IPO in a decade".
Many brokers are expected to cut their losses now that Facebook shares have passed the important psychological thresholds of $30 a share and a 20pc drop in value.
“When something is this broken this quickly, they sell and move on,” said Sam Hamadeh, managing director of US research firm, PrivCo.
Kayak would have been the first US Internet offering since Facebook went public in the biggest technology IPO on record this month.
Morgan Stanley and Kayak declined to comment.
However, James Gorman, the chairman and chief executive of Morgan Stanley, yesterday defended the bank's role in Facebook's IPO, telling employees internally that the firm worked "100pc within the rules" and calling the steep decline in Facebook's stock "disappointing".
In a weekly strategy meeting, which was later webcast to employees, he said he was not "aware of any dissent" among the underwriting firms regarding Facebook's IPO price of $38 a share.