Facebook float but boss keeps complete control

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Facebook unveiled plans for the biggest ever internet IPO that could raise as much as $10bn, but made it clear CEO Mark Zuckerberg will exercise almost complete control over the company, leaving investors with little say.

The Harvard dropout, who launched the social networking phenomenon from his dorm room, will control 56.9 per cent of the voting shares in a company expected to be valued at up to $100bn when it goes public. Facebook says it has 845 million active monthly users.

The long-awaited filing kicks off a process that will culminate in Silicon Valley’s biggest coming-out party since the heyday of the dotcom boom and bust.

In its filing, Facebook says it is seeking to raise $5bn, but that is a figure used to calculate registration fees among others and analysts estimate it could tap investors for $10bn.

That would value the company at $100bn, dwarfing storied tech giants such as Hewlett Packard, while validating the explosive growth worldwide of social media as communication and entertainment.

Zuckerberg’s economic control of about 28 per cent of the shares would be worth $28bn at a $100bn valuation, ranking him as the fourth-richest American.

The 27-year-old’s ownership position means Facebook, a company dissected in 2010’s Oscar-winning The Social Network, will not need to appoint a majority of independent directors or set up board committees to oversee compensation and other matters.

As Facebook states in its prospectus, Zuckerberg will “control all matters submitted to stockholders for vote, as well as the overall management and direction of our company”.

Facebook generated $3.71bn in revenue and made $1bn in net profit last year, up 65 per cent from the $606m it made in 2010.

In a letter accompanying the prospectus, Mr Zuckerberg said: “We often talk about inventions like the printing press and the television.

“Today, our society has reached another tipping point.”

Facebook’s European spokesman is Lord Allan, the former Liberal Democrat MP for Sheffield Hallam.

The IPO is expected mid-year.