Mercury News- In a milestone for one of Silicon Valley's hottest companies, Facebook on Wednesday filed papers announcing a $5 billion initial public offering of stock in the world's biggest social networking business.
The stated size of the offering is smaller than expected, after weeks of speculation by analysts and industry observers who predicted Facebook might seek up to $10 billion. But documents indicated the figure is preliminary; the company could revise the numbers as it prepares to begin selling stock this spring.With the filing of its initial prospectus, stating that it intends to trade under the symbol "FB," Facebook is officially launching Silicon Valley's most widely anticipated stock offering in recent years. For the Menlo Park company and its 27-year-old cofounder, Mark Zuckerberg, it represents an official transition from wildly successful startup to one of the valley's corporate giants.
Industry sources expect the stock offering will set Facebook's overall value at $75 billion to $100 billion. The papers filed Wednesday do not specify a price or how many shares are being offered, although they indicate the company will have two classes of shares; the company is expected to release those numbers in coming weeks.
But the filing provides an initial glimpse into details of Facebook's operations and finances, which the privately held company has closely guarded until now. For example, the company disclosed that it earned $1 billion
Like several other tech companies, including Google, Facebook currently has a dual-class stock structure which the company intends to keep after the offering. Class B shares get 10 votes per share, compared to just 1 vote per share for Class A shares.
Zuckerberg, who serves as CEO, owned 28.2 percent of the Class B shares at the end of last year, but has been given proxies by other investors to exercise the voting authority for what amounts to 57 percent of the current shares.
The next leading shareholder was James Breyer, a member of Facebook's board and a partner at venture capital firm Accel Partners, who owned 11.4 percent of the company's Class B stock at the end of 2011.
Other leading shareholders included DST Global, the investment firm of Russian venture capitalist Yuri Milner, which owned 5.4 percent of Facebook's Class B stock -- and 31.4 percent of its Class A stock; Facebook co-founder Dustin Moskovitz, who owned 7.6 percent of its Class B stock; and Peter Thiel, a prominent tech investor and president of Clarium Capital, who owned 2.5 percent of the company's Class B shares.... Mercury News
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