Facebook Nabs $60 Million Investment from Li Ka-shing
by Kara Swisher
Posted on November 30, 2007 at 12:03 AM PT
While a lot of people were beginning to doubt Facebook’s ability to raise more money after getting a lofty $15 billion valuation following a $240 million investment from Microsoft last month, it seems the stakes are not too high for Hong Kong billionaire Li Ka-shing, who has made an investment of $60 million in the hot social-networking company, according to sources with knowledge of the transaction.
The 79-year-old Li (pictured here) is the chairman of Cheung Kong Holdings Limited and Hutchison Whampoa Limited, a conglomerate with 250,000 employees worldwide. His businesses are especially tied to Hong Kong, where he has massive investments in telecommunications, real estate, electricity, retail, shipping and the Internet.
According to sources, Li is not making the investment in Facebook via the companies he controls, but through another investment entity. He also has the right to invest another $60 million in Facebook.
Li has plenty of cash to do that–he is considered the richest man in Asia and was named the ninth richest person in the world by Forbes last March, with wealth valued at $23 billion.
He built that fortune from humble beginnings–his family fled mainland China when he was a boy. Li, who dropped out of school at 15 after the death of his father, started his career as a worker-laborer in a plastics company.
Facebook, according to sources, is still planning on raising more investment dollars, although some once-hot prospects, such as Providence Equity Partners, have dropped out due to the onerous terms Facebook has demanded from investors.
While both Microsoft and Li have agreed, for example, Providence was put off by the lack of downside protection and also the fact that a major investment in Facebook would not get them a seat on the board of the start-up. Neither Microsoft nor Li will get a Facebook board seat.
The deal with Li came through a Facebook investor, who introduced the company to Solina Chau, director of the Li Ka-shing Foundation. Chau is also a major stockholder in Tom.com, a media company in China in which Li’s companies also have an interest. His investment might give Tom a leg up in possible partnerships with Facebook in China, said sources.
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Comments
Good Job Kara… The muscle of old media is kicking in with all these scoops
Btw, whats up with Superman’s interest in all these internet companies? (e.g. Joost)
Posted by Jack Nicholson at November 30th, 2007 at 1:47 amWAY TO GO WITH THE BIG SCOOP. I like the Ka-shing background, too. But why does Facebook need this much money? Was this simply an exercise in validating its valuation?
Posted by Glenn Kelman at November 30th, 2007 at 7:55 amWell, maybe for lawsuits!
See here (much juicier!):
http://kara.allthingsd.com/200.....-violated/
Posted by Kara Swisher at November 30th, 2007 at 11:14 amThis is amazing. Don’t they have anything else to do than throwing money at Facebook? This is terrible waste of money. Instead of doing this charity; they should invest the same money in OLPC project.
Posted by Nirav Bhavsar at November 30th, 2007 at 10:23 pmGood point. although that project has its own issues.
See here:
http://kara.allthingsd.com/200.....a-bargain/
Posted by Kara Swisher at December 3rd, 2007 at 8:09 am