Facebook welcomes $200 million Russian investment

Posted on Wednesday, May 27th, 2009 and is filed under Legal, Press Release. You can follow any responses to this entry through the RSS 2.0 feed. Responses are currently closed, but you can trackback from your site.

Digital Sky Technologies follows Microsoft and buys stake in Facebook.Los Angeles, CA(JusticeNewsFlash.com)–Facebook, a social networking website whose U.S. headquarters are located in Palo Alto, California, announced the acceptance of a $200 million investment from a Russian firm on Tuesday. The Los Angeles Times reports the Russian Internet investor, Digital Sky Technologies, will now have close to a two percent stake in Facebook’s preferred stock but will not get a board seat.Facebook now counts 200 million users of its social community Web site with 70 percent living outside of the United States. The Russian investor values Facebook at $10 billion. The social media company has not reported a profit yet and business litigation experts say this deal seems similar to the previous Microsoft deal in 2007. Microsoft invested $240 million for a 1.6 percent share in the company based on an implied $15 billion Facebook valuation. Details in a legal settlement revealed Facebook’s own appraisal after the Microsoft deal at $3.7 billion.The business deal between the Internet based companies further requires Digital Sky Technologies to buy another $100 million in common Facebook stock at a minimum. Facebook relies heavily on advertising to make money similar to other huge technology companies like Google and Yahoo. Financial analysts remain skeptical about Facebook’s ability to run a profit.JusticeNewsFlash.com news for California business litigation lawyers.

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