Facebook Opens Stock Trading

Facebook got a $200-million investment in May from Russian IT investment firm Digital Sky Technologies. The $200 million earned the Russian company a 1.96-percent stake in preferred stock, but, at the time, it said it intended to buy another $100 million worth of common stock from existing shareholders in the near future. Well, that near future is now, as Facebook is apparently finally allowing investors and employees to sell their shares at the social network.

“While individuals must make their own decisions about participating in this program, I’m pleased that the price D.S.T. is offering is much greater than the price originally considered last fall,” Mark Zuckerberg, Facebook’s chief executive, said in a statement, according to The New York Times. “This is recognition of Facebook’s growth and progress towards making the world more open and connected.”

The $200-million investment in May valuated Facebook at $10 billion, above the market estimates at the time. However an earlier investment from Microsoft in the fall of 2007 put the social network at an impressive $15 billion and the $240 million the Redmond giant payed only got it a 1.6-percent stake. Still, it meant that Google didn't get its hands on the, then, new social network, so it was money well spent for Microsoft.

DST plans to increase its stake in Facebook from the current 1.96 percent to 3.5 percent if all of the $100 million it is offering will be taken. This new wave of stock buying only valuates Facebook at $6.5 billion, as DST is offering $14.77 per share. Well below the initial $10 billion, but this was to be expected, as DST will be acquiring common stock now and, in fact, it was anticipated at the time of the initial deal.

This may be an opportunity for employees and other shareholders to unload some stock as, even though an IPO has been rumored for a while now, CEO Mark Zuckerberg says there are no plans for one in the near future. Still others may decide to hold out waiting for a better offer or the IPO.