Monday, 13 June 2011

Facebook looking at IPO

The number of people using Facebook has dropped in the UK for the second month in a row, mirroring similar falls in the US, Canada and Norway, giving the first signs that the social network's popularity may be decreasing in the west.


The website continued to grow worldwide, hitting an all-time high of 687 million users, according to data from the tracking company Inside Facebook, which uses Facebook's own advertising tools to determine the number of people using the site every month. That slowdown could stop founder Mark Zuckerberg's ambition to reach 1 billion users worldwide, despite his prediction last June that "it is almost a guarantee that it will happen".

The fastest-growing countries, including Brazil and Mexico, grew at a maximum of 10% over the month.

Meanwhile, reports in the US suggest that Facebook may have to make a public share offering at the beginning of 2012 because it will have more than 500 shareholders. US securities exchange commission rules oblige companies to make a listing once they passed this number.


Facebook is preparing to file for an initial public offering as early as October or November that could value the popular social networking site at more than $100 billion, financial news channel CNBC reported on Monday.



Goldman Sachs is leading the chase to manage the lucrative offering, which could come in the first quarter of 2012, CNBC said.


With more than 500 million users, Facebook is the world's most popular Internet social network and one of the most hotly-anticipated initial public offerings on Wall Street.


Facebook, whose chief operating officer last month told Reuters that an IPO was "inevitable," declined to comment on the latest report about its timing for an offering.


Anticipation about a Facebook's future plans comes at a time of heightened investor appetite for shares of fast-growing social networking companies.



Professional networking site LinkedIn Corp launched its own IPO last month, valuing the company at about $7 billion.


Earlier this month, daily deals site Groupon Inc filed to raise up to $750 million in an IPO, fueling speculation that Internet valuations have become too rich.


Founded in a Harvard dorm room in 2004 by the now 27-year-old Mark Zuckerberg, Facebook threatens Internet companies like Google Inc and Yahoo Inc as it becomes a popular online destination for Web surfers and an important marketing channel for advertisers.


Facebook was valued at $50 billion earlier this year when Goldman Sachs invested in the company.


Recent transactions of Facebook shares on the secondary market have valued the company between $78 billion and $81 billion, according to information on the website of Sharespost, an exchange for trading shares in private companies.


Facebook is expected to generate roughly $4 billion in advertising revenue in 2011, up from $1.86 billion a year earlier, according to market research firm eMarketer.

http://www.reuters.com/article/2011/06/13/us-facebook-idUSTRE75C3T820110613
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