14 DAY TRIAL // With 350 million users worldwide, an estimated $500 million in revenue this year and positive cash flow, Facebook is looking pretty good at this point to any investor. The company though isn't really looking for new capital and an IPO is still quite a way off. For a determined investor though, these problems can be overcome, and Russian investment company Digital Sky Technologies seems to be one. It bought a small stake in Facebook last summer, 1.96 percent, and then continued to acquire common stock from employees or other shareholders to the point that DST is now said to own more than 5 percent in the social network.
Russian business newspaper Kommersant cites [translated] an unnamed inside source which claims that, not only DST now has a more than 5 percent stake, it is looking to increase it further with additional purchases. This means that DST's stake is now three times larger than Microsoft's, which owns just 1.6 percent purchased at a whooping $15 billion valuation.
DST paid $200 million for its initial stake in a deal which valued Facebook at $10 billion. At the time, it had the option to purchase an additional $100 million-worth of common stock at a lower $6.5 billion valuation, coming in at $14.77 per share. It quickly gobbled up the new shares, which meant it owned a further 1.53 percent in Facebook adding up to almost 3.5 percent. Apparently, DST started another round of share acquisitions in October, at the same lowered valuation, now reaching 5 percent ownership meaning that it poured over $400 million into the deal.
DST is the biggest player in the Russian Internet market and has several other online proprieties in Eastern Europe. It made quite a splash when the initial deal with Facebook was announced and recently it lead a $180-million round in Zynga, the biggest social gaming company in the world at the moment. IT is also said to be looking to buy ICQ from AOL.