Rapidly rising Internet star Facebook Inc. has sold a 1.6 percent stake to Microsoft Corp. for $240 million, spurning a competing offer from online search leader Google Inc.
The deal announced today after several weeks of negotiation values Palo Alto-based Facebook at $15 billion — less than four years after Mark Zuckerberg started the online social networking site in his Harvard University dorm room.
According to Facebook, the hottest social network website, Microsoft is now the “exclusive third-party advertising platform partner for Facebook, and will begin to sell advertising for Facebook internationally in addition to the United States.” Nearly 60% of Facebook users connect outside the U.S.
Kevin Johnson, president of Microsoft’s Platforms & Services division told the Wall Street Journal that “We’re very pleased with the scope and depth of our partnership, and projected market for online advertising was $40 billion. “It’s a big industry,” he said. “The equity stake we’re taking is a strong statement of confidence about this partnership.”
At this valuation, each of Facebook’s 50 million users is worth $306.12.