KUALA LUMPUR: Facebook Inc will have its shares first traded on the US Nasdaq market later tonight. A strong debut in the market beyond the social networking giant’s US$104 billion (RM323.44 billion) market capitalisation upon listing will make tycoon Tan Sri Vincent Tan a few hundred million ringgit richer.
Tan’s MOL Global Pte Ltd owns 3.5 million shares in Facebook. The stake is worth US$133 million (RM413.6 million) based on the IPO’s highest price range of US$38 per share.
MOL’s cost for the Facebook shares is said to be US$38 million, being its acquisition price for a social networking site Friendster in late 2009. Friendster had subsequently in May 2010 sold a bundle of patents to Facebook in exchange for the 3.5 million shares in the company, co-founded in 2004 by Harvard graduate Mark Zuckerberg.
Tan owns 88% of MOL while MOL group CEO Ganesh Kumar Bangah has a 12% stake in the company. Ganesh himself is set to be a multi-millionaire given his indirect interest in the Facebook shares.
Ganesh, when met at a Friendster’s function yesterday on the launch of online games, declined to comment on MOL’s holdings in Facebook, citing the non-disclosure agreement signed when it sold the patents to the social networking giant.
Nonetheless, he said MOL has been benefiting from the acquisition of Friendster.
“Before we acquired Friendster, we were quite unknown. Having Friendster’s branding helped open doors to big players that had previously been shut,” said Ganesh.
“Our revenue last year was about RM500 million and our profit was RM20 million. It is difficult to estimate Friendster’s contribution but since we bought it, it has tripled our revenue from online gaming,” he added.
Ganesh explains that MOL did not acquire Friendster to compete with Facebook.
“Facebook is a general purpose social networking site. We have transformed Friendster into a social gaming and social discovery website.”
He said an additional US$15 million has been invested in Friendster which boasts 115 million registered users, of whom 10% comes from Malaysia.
While Friendster has users in over 75 countries, its major markets are in the Phillipines, Malaysia, Singapore, Indonesia and India. Ganesh said the company will continue focusing on these markets for the time being.
Written by Ben Shane Lim, theedgemalaysia.com
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