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Homechevron_rightBusinesschevron_rightFacebook plans to go...

Facebook plans to go public to raise $87bn

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Facebook plans to go public to raise $87bn
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Washington: Facebook will go public with a stock price of $28 to $35 to set the popular social network's valuation as high as $86.6 billion, according to documents filed with the Securities and Exchange Commission.


At the midpoint of the initial range, $31.50, the initial sale of more than 337 million shares of Facebook stock would net more than $10.6 billion, with about $5.6 billion of that going to the company.

The rest will go to existing stockholders who are selling their shares, including CEO and cofounder Mark Zuckerberg and venture capital investors such as Palo Alto-based Accel Partners.

The company's valuation at the midpoint of the suggested range would be about $78 billion, short of many projections that Facebook would shoot for a valuation of up to $100 billion.

Initially established in a Harvard dormitory by Zuckerberg and some friends as college-specific social networks closed off to interested outsiders, Facebook eventually opened up to the world and became the most popular social network in history, with more than 900 million monthly active users.

However, Facebook's profits dipped in the first three months of 2012 when compared with the same quarter in 2011.

While sales hit $1.06 billion in the first quarter, up 45 percent from the year-ago quarter, thanks to a 37 percent increase in advertising revenue, Facebook's total profit dropped to $205 million, from $233 million a year ago.

Facebook's most anticipated stock debut for Silicon Valley in several years is expected to set records for funds raised and valuation for an Internet company.

Google's IPO in 2004, which set the company's value at $23 billion and reaped $1.9 billion for the Mountain View search giant, is the largest for now.

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