Facebook valued at $10 billion as Russian internet company buys stake
Thursday, May 28, 2009/
Social networking giant Facebook has accepted a US$200 million investment from a Russian internet company, placing the site’s value at around US$10 billion.
Digital Sky Technologies, run by Russian entrepreneur Yuri Milner, has grabbed a 1.96% share in the company and has offered to buy another US$100 million worth of stock from current Facebook employees.
While Milner was seeking a place on Facebook’s board, the site has confirmed that DST will not be represented on the board or hold any special rights.
“This investment demonstrates Facebook’s ongoing success at creating a global network for people to share and connect,” Facebook chief executive Mark Zuckerberg said in a statement.
“A number of firms approached us, but DST stood out because of the global perspective they bring – backed up by the impressive growth and financial achievements of their internet investments. We’re looking forward to working with the DST team.”
Milner said that the site’s investment experience “reveals the tremendous value social networking companies create, as they redefine how people communicate and interact”.
DST already operates several social networking sites including vKontakte, which claims to be “the biggest website in Russia”. The company’s assets count for 70% of all page views on Russian internet pages.
The company is run by Milner along with Gregory Finger, former head of the Moscow branch of billion-dollar hedge fund NCH, and Alexander Tamas, previously co-head of internet and software for Goldman Sachs’ investment banking division.
Zuckerberg said in a conference call that Facebook did not require an immediate investor, but wanted to take the DST deal to help grow the business.
The deal comes after Zuckerberg said earlier this year that the company “will consider [investment] for no other reason than to have more buffer if we want to do something in the future”.