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Facebook sells equity: Reportedly valued same as Tesco

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Cash-loaded Goldman Sachs clients with more than $2m to wave around were told over the weekend that they would soon have the opportunity to invest in Facebook.

According to a report in the New York Times, the brokerage plans to offer its clients up to $1.5bn in Facebook Inc equity.

Goldman Sachs said in an email to would-be investors on Sunday that they could splurge cash on a “private company that is considering a transaction to raise additional capital”.

But the unnamed firm was quickly identified as Facebook which – according to sources cited by the NYT – got tagged with a valuation of $50bn, after raising $450m from Goldman Sachs and $50m from a Russian investor.

Clients of the brokerage who do plan to invest in Mark Zuckerberg’s company have to cough up at least $2m, not sell their shares in Facebook until 2013, and steer clear of trading in secondary markets where the firm trades. That’s because they will be given juicy non-public information about the social network.

Investors interested in the opportunity will receive an email shortly with a “private placement memorandum”.

But such an investment doesn’t come without a certain amount of heat, given that Facebook is reportedly under scrutiny from US securities watchdog, the US Securities and Exchange Commission (SEC).

As noted by the Wall Street Journal last week, a series of letters have been sent to an unknown number of people trading in the stock of Facebook and Twitter. It's understood that the SEC, whose investigation is at a preliminary stage, wants to know how such funds in what is a growing secondary marketplace are valuing shares of those privately-held internet companies.

If the reported valuation of Facebook at $50bn based on the new equity offerings is correct, it's worth noting that the cloudy Web-2.0 firm thus considers itself to be worth almost as much as dominant UK retail monster Tesco ($54bn), laden with real-world assets such as shops, trucks and stock. ®

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How much?!

Really it beggars belief that the value appears to be around $100 per signed-up user name. Just how are they going to earn a decent return on this money?

I despair that my future prosperity & pension is about to be pissed away by 'investors' once more.

7
0
Anonymous Coward

Dot Com Crash 2.0...

Let the bubble inflating begin!

5
0
Anonymous Coward

And a Facebooker has about the same value

as one of Tesco's tins of beans in the red, white and blue livery

5
0

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