Microsoft buys $240 million stake in Facebook

[mandy]

Microsoft is in talks to buy a minority stake in the popular social-networking Web site Facebook Inc., a sign of a new urgency by the software giant to jump-start its online business at a time when Google is widening its lead in the fast-growing Internet-advertising business. As part of its catch-up program, Microsoft also has quietly granted broad powers to an executive recently hired from outside the company, who is expected to help shake up the software giant's online business.

Microsoft in recent weeks approached Facebook with proposals to invest in the startup that could value the fast-growing site at $10 billion or higher, said people familiar with the matter. If those talks bear fruit, Microsoft could purchase a stake of up to 5% in the closely held startup, at a cost in the range of $300 million to $500 million, the people said.

But Microsoft must first outgun Google, which has also expressed strong interest in a Facebook stake, according to people familiar with the matter...

full article: http://online.wsj.com/article/SB119065193646437586.html

[mandy]

Update:

It's official: Microsoft will take a $240 million equity stake in Facebook during its next round of financing, valuing the company at a whopping $15 billion.

News.com's Ina Fried in her Beyond Binary blog reported earlier Wednesday that Microsoft had beaten out Google in the high-stakes bidding war for the slice of tasty Facebook cake. The final deal resulted in a 1.6 percent stake in the social-networking company, notably smaller than the 5 to 10 percent that had been talked about in recent weeks...

full article: http://www.news.com/the-social/8301-1357...l?tag=head