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Wednesday, November 26th, 2014

Facebook IPO Crushes Records

Facebook, the world’s most popular social networking site, continues to make headlines with aggressive moves as it approaches its initial public offering (IPO), currently set for May 18. The company currently values itself between $86 and $96 billion, and will offer up to 3374.4 million shares at a price between $28 and $35. The eight-year-old company hopes to raise some $11.4 billion for future ventures.

Just a few weeks ago, Facebook announced that it would acquire Instagram, a photo sharing social network, for around $1 billion and stock. The final deal ended up being $300 million cash and 23 million shares. But with the announcement of Facebook’s IPO range, the final value of the deal could be worth even more than the initial deal at $1.1 billion.

The investment in up-and-coming properties such as Instagram displays Facebook’s commitment to continued growth even as it sits atop the social media market. This commitment is led by CEO Mark Zuckerberg, who founded the company as a 19-year-old in 2004. After the IPO, Zuckerberg could be worth as much as $17.6 billion, putting him ahead of current Microsoft CEO Steve Ballmer.

Even at $86 billion, Facebook would be the highest valued company at IPO in American history at a price of almost four times that of Google, the previous record holder at $23.4 billion. However, as with any company in the technology field, maintaining value over time is the key struggle, as technology advances at a faster rate than most industries.

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