Bloomberg: Microsoft to hold onto Facebook investment post-lockup

According to sources speaking to Bloomberg, Microsoft intends to hang on to its Facebook shares, once the lockup period expires in the coming week.

Purchased at a valuation of $15, Microsoft’s roughly 1.6% investment in the company cost it $240 million, back in 2007. The deal was a smashing surprise, giving Facebook a public relations boost that only a nine-figure deal could supply. According to the Associated Press, Facebook rejected an offer from Google to accept Microsoft’s.

What’s the stake worth now? Reuters pegs it as worth $551 million, meaning that, even with Facebook’s precipitous drop since its initial public offering, Microsoft has still made out very well on its investment.

Why might the company not sell? The 1.6% (or 1.7%, depending on who you ask and how they calculate) that Microsoft owns hardly gives it a seat at the table in terms of setting policy at the company, but the investment has been followed by close cooperation by the two firms. Microsoft might not sell its stake as a good-faith measure, indicative of its devotion to continued collaboration.

Or, it thinks that Facebook’s current valuation is soft, and will, eventually, rise. Whatever the case, Microsoft, it appears, won’t be adding any downward pressure onto the good ship Facebook next week.

Top Image Credit: Emmanuel Huybrechts