Facebook to go public with €69bn valuation

FACEBOOK is reportedly set to go public as early as the first quarter of next year, at a valuation that could top $100 billion (€69bn).

US financial news channel CNBC has reported that Goldman Sachs is leading the chase to manage the lucrative offering.

Chief operating officer for the social networking giant Sheryl Sandberg last month called an initial public offering (IPO) “inevitable” and “the next thing that happens”.

However, a spokesperson for Facebook yesterday declined to comment on the speculation.

According to the CNBC report, should the IPO happen, it would likely be triggered by a section of the 1934 Securities and Exchange Act known as “the 500 rule”.

In short, the rule ensures that once a private company has more than 500 investors, it must begin releasing quarterly financial information to the Securities and Exchange Commission, just as public companies do.

Should the move go ahead, the floating of Facebook is likely to be the most hotly anticipated stock debut since Google.

Only a handful of US companies have stock-market values above $100bn. These include some of the giants of corporate America such as Exxon Mobil, General Electric and JP Morgan Chase.

Facebook chief executive Mark Zuckerberg has been notoriously reticent to talk about the possibility of the company going public.

Just last December, Mr Zuckerberg simply responded “maybe” when TV show 60 Minutes asked him whether he would ever push his firm into the public markets.

Last January, when Goldman Sachs and a number of other private investors put $1.5bn into Facebook, the company was valued at a reported $50bn. However, other reports have put this valuation closer to $85bn with many insiders expecting its valuation to top $100bn by early 2012.

Despite this, recent figures have shown that the social networking site may have reached saturation point in the countries where it first enjoyed most success.

Almost 6m US users left the site last month, dropping from 155.2m to 149.4m, a fall of 3.7%. This was the first time it has lost users month-on-month in the last year.

In Britain, some 100,000 people abandoned the site with similar falls recorded in Norway and Russia.

Although the popularity of the site has continued to grow worldwide, the rate of growth fell for the second month in a row.