Facebook delays its initial public offering to focus on products
Published 16/09/2011 | 05:00
FACEBOOK is set to delay its initial public offering (IPO) until late next year as the company focuses for now on product development. The IPO is likely be one of the most lucrative in market history.
The company, which is currently traded in a manner similar to the 'grey market' here, is valued at close to $65bn (€46.8bn). Less than two years ago, it was worth just $9bn.
Until Facebook goes public, however, regular investors will probably have to wait before they get the chance to put their money into the social-networking giant.
Only 'accredited investors' are allowed to buy the stock, which is traded on the SecondMarket exchange in the US.
They must have an income of at least $200,000 or assets worth $1m.
Even if an investor meets those standards and clears SecondMarket's background check, the chances of them getting their hands on Facebook stock are still remote.
The vast majority of investors are hedge funds or investment banks. The average transaction in the company is worth $2m.
Those who get the stock seem to be on a winner, at least in the short term.
Elevation Partners, an investment firm fronted by U2's Bono, has seen a €145m investment nearly quadruple in value in less than two years to €676m.
That is a big turnaround for Bono, who was deemed "the worst investor in America" by the '24/7 Wall Street' last year.
Facebook has generated by far the most interest among investors but its growth has not been unique at a time when there are very real fears about a new tech bubble.
Professional networking site LinkedIn doubled in value on the day it floated earlier this summer and is still trading far above its $45 IPO price.