Microsoft Admits Having Tried To Buy Facebook For $15 Billion
Facebook could've belonged to Microsoft now if everything went according to plan
Facebook showed a lot of promise ever since it started out in a dorm room, founded by several teenagers. Naturally a lot of companies have through the years shown interest in acquiring the social network which has now grown to appeal to over 500 million people. Amongst them was software giant Microsoft who apparently wanted to buy Facebook several years ago for an estimated sum of $15 billion. While Microsoft’s CEO Steve Ballmer manifested his interest towards Facebook , the social network’s CEO Mark Zuckerberg didn’t think that was a good move, TechSpot reports.
“Yeah, we tried to acquire Facebook,” Microsoft M&A exec Fritz Lanman admitted earlier this month during the Le Web conference that took place in Paris. He added that Facebook had a lot of similarities to Microsoft a while ago. While the deal never finalized, the Redmond-based giant ended up investing over $240 million for a 1.6 percent stake in Facebook. While the Microsoft acquisition of Facebook would’ve made a lot of sense, the company was criticized on multiple occasions that it had inflated Facebook’s value to $15. Then again, Facebook was already showing a lot of promise for growth and is now estimated to be worth considerably more than that (over $50 billion).
People hinted for a long period of time that Microsoft had come up with an offer to acquire Facebook. In fact, Facebook’s CEO Mark Zuckerberg has several weeks ago admitted that he’d received such an offer. However, it’s nice to finally see a Microsoft executive admitting to the buyout attempt. This move comes to support some selections from David Kirpatrick’s book called “The Facebook Effect”.
It basically explains how Microsoft’s CEO Steve Ballmer flew to Palo Alto to visit “his young counterpart” on two occasions. Upon his arrival there, Ballmer went for a long walk with Zuckerberg who told him that Facebook was raising money at $15 billion valuation. Ballmer thought it’d be a good idea to present another option. “Why don’t we just buy you for $15 billion?” he replied, according to a very knowledgeable source. Zuckerberg wasn’t really impressed with this offer and declared that he didn’t want to sell the company unless he could remain in control. Ballmer reportedly took his reply as a sort of challenge and retreated to Microsoft’s headquarters to come up with a plan to acquire Facebook in stages over a period of years. This strategy was meant to enable Zuckerberg to keep the control he requested. However, Zuckerberg rejected all versions of the deal that he was offered. Apparently the book also states that: “What Ballmer finally agreed to instead was an advertising deal that included a provision for Microsoft to pay a huge amount, $240 million, for a sliver of Facebook, 1.6%. Microsoft’s investment gave Facebook an implied value of $15 billion.”
Well, that’s supposed to be the whole story of what happened between Microsoft and Facebook. Facebook is taking some advantage of Microsoft’s interest and it has recently integrated with Microsoft’s Bing search engine.
