PRIVATE INVESTORS have been selling shares in Facebook for $76 each, according to reports today – which would value the company at an astonishing €26.6bn, before the company even considers floating itself on a stock exchange.
The Financial Times today reports that shares in the company, being traded privately because the social networking site has not been floated, were fetching remarkable per-share prices on so-called ‘secondary markets’.
There is a slight premium to such shares, however, because of the fact that private limited companies are limited by law to having a maximum of 500 shareholders.
Even still, if the company was to be floated with shares valued at $76 (€59.88), the company would instantly be worth a remarkable $33.7bn – or about €26.6bn.
By comparison, Yahoo! is worth about $18bn on today’s values, while Microsoft and Google – businesses with far more wide-reaching and diverse – are worth $208bn and $143bn each. Apple is worth $219bn.
Facebook’s $33.7bn valuation would make its founder Mark Zuckerberg (26) between $6.7bn and $10.11bn, depending on how much of the business he retains ownership of, with varying reports saying he owns 20% to 30% of Facebook.
Facebook said two weeks ago it was likely to postpone its Initial Public Offering – entering a public stock exchange – until early 2012. Some of its senior employees are remunerated in shares, however, and are welcome to sell them on private secondary markets.
PROCESSOR MANUFACTURER INTEL has agreed a massive €6bn cash deal to buy the security and anti-virus firm McAfee.
The deal will see Intel pay $48 (€37.40) per share for the security company, compared to the $29.93 closing price for McAfee shares on the NASDAQ yesterday evening.
Unsurprisingly, McAfee shares have taken an extraordinary spike this morning and were trading at $47.16 – an increase of 57.6% – at the time of writing.
It shares had been worth similar amounts as recently as the end of April, when the company revised its Q2 earnings significantly downward, but recovered some of its value when its ultimate Q2 earnings were higher than its downward forecasts.
Intel said that the deal would reduce its own net earnings in the first year after takeover, but that the takeover would significantly augment its own security services. Its own shares are down slightly today as a result.
It added that the takeover reflected how security was now a concern at the very core of computing, joining energy efficiency and connectivity as the ‘third pillar’ of computing requirement.
The processing giant – which employs over 4,000 people at its campus in Leixlip – said in its earnings reports for 2009 that it had almost $4bn in the bank and another $5.2bn in short-term investments – meaning it will probably have to seek a reasonable amount of financing to help fund the deal.
SHARES IN ALLIED IRISH BANKS have fallen by 6% this morning after the bank announced record losses for the first six months of the year. From a close last night of 99c, prices had earlier fallen as low as 86c – a fall of 13% – but rebounded since and currently trade at 93c, down 6%.
IRELAND’S BIGGEST BANK, AIB, has posted one of the biggest losses in its history, with losses of €1.7 billion post-tax losses for the first six months of the year.
The AIB Group’s interim results, released this morning, show an operating profit of €976m before provisions for bad debt were taken into account, but the bank lost €963m in the loans transferred to NAMA – and set aside a massive €2.315 billion to cover loans it doesn’t expect to get back.
The bank’s losses before tax exceeded €2bn – compared to €872m in the same period last year.
The bank confirmed that the Financial Regulator required it to generate €7.4bn in equity capital by the end of December – raising fears that more public funds could be required to keep the bank afloat.
Unsurprisingly as a result, the bank will not be paying a dividend on its shares for the moment.
The bank’s UK arms posted a loss of £55m, but its Polish subsidiary, Bank Zachodni, made a profit of €142m before its bad debt provisions, indicating that the sale of the Polish operation might be top of the agenda in its attempts to restructure.
Publishing its report, the bank described the “six months to 30 June 2010 was a very difficult period for AIB and our customers”, and admitted that a “significant level of credit losses was experiencedin the period in addition to the loss on transfer of the first tranche of loans to the National Asset Management Agency.”
The bank also said that market conditions “remained challenging” and that the banking environment made it difficult to generate income. In the short term it hoped to complete the transfer of loans to NAMA and to restructure under the guidance of the European Commission.
The bank’s executive director, Colm Doherty, told RTÉ’s Morning Ireland that the bank was in discussions to offload some of its foreign operations but said the talks remained confidential.
He conceded, however, that the bank’s restructuring will probably result in job losses.
SHARES IN the two Irish banks have risen significantly this morning as investors react positively to the results of the EU stress tests.
Both of the Irish banks involved – AIB and Bank of Ireland – have seen their prices spike as traders get their first chance to respond to the tests, which were released late on Friday after markets had already closed.
Despite only having been credited with “scraping through” the tests, AIB shares took the bigger jump initially, rising to 96c in early trading – a jump of nearly 7% from their close on Friday – before settling at 93c, still recording a rise of about 3.3%.
GAINS have been seen on world markets as a result of better-than-expected earnings from Apple.
Revenues rose 88% in the third quarter up to June 26 to $15.7bn and the company saw a 78% jump in profits yesterday. The results show income jumping to $3.25 billion, or $3.51 per share, from $1.8 billion, or $2.01 per share a year ago. Shares for Apple are up 5% as a result.
According to Business Insider iPad, Mac, and iPod shipments were all stronger than expected: Apple shipped 3.27 million iPads, 3.47 million Macs, and 9.4 million iPods during the June quarter.
Reacting to the results Steve Jobs said “it was a phenomenal quarter that exceeded our expectations all around, including the most successful product launch in Apple’s history with iPhone 4,” said Apple’s CEO. “iPad is off to a terrific start, more people are buying Macs than ever before, and we have amazing new products still to come this year.”
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