Facebook IPO Announced – Values Company At US$104 Billion

  • Shares to cost US$38
  • Values Facebook at $104 billion
  • 2011 revenue was US$3.7 billion

After much speculation and hype, some solid figures are being released about the Initial Public Offering (IPO) of Facebook shares, which many think will be listed on the Nasdaq stock market on Friday, US time.

The company has priced its shares at $38 each, which will mean it will raise about US$16 billion, not bad for a company that has nothing tangible to sell. And if the demand is high, and all shares are released, the money raised could more than $18 billion.

But before mum and dad investors start rubbing their hands with glee at the idea of investing in a company that has all of Wall St lining up to grab their share, ordinary investors will be lucky to get a look in – at first. Most, if not all, of the stocks will be sold to hedge funds and other financial conglomerates who can afford the blocks being sold.

If the shares do go for the asking price, it will give the company a valuation of just over $100 billion – quite good for a company that brought in US$3.7 billion in revenue last year.

And if you are an uber investor with a tonne of cash to put into the company, hoping one day to control it, don’t hold your breath. Co-founder and CEO Mark Zuckerberg has structured the company is such a way that there are two class structures of stock, which are said to ensure that he and other key executives will never lose control of the entity.

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