[Dabhand16]

Microsoft buys stake in Facebook

Microsoft has paid $240m (£117m) for a 1.6% stake in Facebook that values the hugely popular social networking site at $15bn (£7.3bn).

Facebook spurned an offer from Microsoft's rival Google, which was also keen to invest the site.

Microsoft will also sell internet ads for Facebook outside the United States as part of the deal that took several weeks of negotiating.

Microsoft already provides banner advertising and links on the US site.

Mark Zuckerberg started the online social networking site in his Harvard University dorm room less than four years ago.

Mr Zuckerberg, 23, has indicated he would like to hold off on an initial public offering for at least two more years.

He rebuffed a $1bn takeover offer from Yahoo last year.

Advertising magnet

Facebook hopes to become an advertising magnet by substantially increasing its current audience of nearly 50 million active users.

Facebook allows users to set up personal web pages and communicate with each other.

Google and Microsoft have crossed horns before for hot Internet properties.

Google beat Microsoft with a $1.65bn acquisition of online video sharing site YouTube last year.

Facebook expects to make a profit of $30m this year so on conventional valuations a $15bn price tag would look expensive.

Source: BBC

[Dave]

Not jealous of a 23 year old worth that amount

[Steve]

Originally Posted by Dabhand16

Microsoft has paid $240m (£117m) for a 1.6% stake in Facebook that values the hugely popular social networking site at $15bn (£7.3bn)....He rebuffed a $1bn takeover offer from Yahoo last year.

Originally Posted by Dave

Not jealous of a 23 year old worth that amount

Me neither, he seems to have much more luck and business sense than me...I would have run off with the $1bn without looking back

[Dave]

So many toys to buy, countries to see ..... I'd be outta there

[silkstone]

An internet site worth $15 billion?

What a crazy world.

[GainfulShrimp]

The funniest thing about that valuation is that Facebook is a complete waste of time!

Don't get me wrong... I love Facebook and nowadays it's my first port of call when online, but I'm also the first to admit that it's more fun than useful. Constant frivolous updates on what my friends are doing is something I like, but can't see how it's *worth* much to anyone. The power of advertising, eh..?

Personally I very much doubt that it's worth $15bn, but Microsoft probably felt sore after Google nabbed YouTube, hence this time decided to open up their deep pockets and probably ended up paying a premium to get one up on their arch rival.