Digital Sky's stock purchase values Facebook at $6.5 billion
15 Jul 2009
Russian internet company Digital Sky Technologies (DST) has offered to buy $100 million worth of stock of the fast-growing social networking site Facebook from the site's employees, in a deal that values the social network at $6.5 billion.
DST had purchased a 1.96-per cent stake in preferred stock in the privately held Palo Alto, California-based company in May, a deal which valued the company at $10 billion (See: Digital Sky deal values Facebook at $10 billion). It was the company's biggest cash-raising operation in two years.
The Russian company had acquired around $200 million worth of Facebook stock in May. The company is now offering $14.77 per share of Facebook common stock.
According to Jennifer Gill, a DST spokeswoman, the tender offer would close in August.
Mark Zuckerburg, Facebook chief executive while confirming the DST offer said that individuals need to make their own decisions about participating in this programme and he was pleased that the price DST was offering was much greater than the price offered last fall.
"This is recognition of Facebook's growth and progress towards making the world more open and connected," he said.
When DST had purchased the 1.96-per cent equity stake in Facebook, the company had said it would purchase at least $100 million of common stock held by current and former Facebook employees.
As the social networking site grows bigger and bigger two questions industry experts are wondering about how much the company is really worth after all and when will Zuckerberg and his team decide to go public.
