Facebook announces $5bn stock flotation plan

Thursday, 02 February 2012 11:20

Facebook, the world’s largest social networking site, has revealed plans to sell shares to the public.

An initial public offering of $5 billion – or £3.2 billion – was filed with the US Securities and Exchange Commission last night. It is thought to be the biggest initial IPO ever made by an internet company.

The registration documents filed show that chief executive Mark Zuckerberg owns 28.4 per cent of the company.

Facebook was founded in 2004 and currently has 845 million active users across the globe.

Last year it made a net profit of $1 billion, or £631 million, up 65 per cent on the previous year.

According to the documents Mr Zuckerberg will keep majority control of Facebook after the flotation but will take a reduced salary of just $1 from January 2013.

The highest amount an internet company has previously raised on the stock market was $1.9 billion recorded by Google in 2004.

In the registration documents filed with the SEC, Mr Zuckerberg stated that the company was going public for its employees and its investors.

“We made a commitment to them when we gave them equity that we’d work hard to make it worth a lot and make it liquid, and this IPO is fulfilling our commitment,” he said.

“As we become a public company, we’re making a similar commitment to our new investors and we will work just as hard to fulfill it.”

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