Naspers: no faith in Facebook

Naspers, the South African media giant, says it will look to get rid of its remaining shares in social networking group Facebook as soon as it can, having already sold two-thirds for a book profit of R1.5 billion through

Naspers says it does not own a direct stake in Facebook, but rather has in indirect investment through Russian Internet company, Mail.Ru, which owns the shares.

In an interview with MoneyWeb, Naspers CEO, Koos Bekker, did not shy away from the company’s stance that it is looking to shed the Facebok stake as soon as possible.

“We ended up with a stake in Facebook [through Mail.Ru] when the company was listed – and the bankers are, of course, clever enough to limit you,” Bekker said.

According to Bekker, Naspers was able to sell one third of its stake in Facebook when it listed – with a company value of $100 billion – which it did, gaining a maximum profit.

“Then we sold one third recently, at about half that price – and then we still hold one third, which we’re not allowed to sell until next year,” Bekker said.

“So, regrettably, they stagger you – but we made a nice fat profit,” he said of the R1.5 billion amount. And despite not being a direct shareholder in the social network, Bekker cast doubt over Facebook’s true value, pointing out the company’s drop in market capitalisation since its IPO.

“The interesting question is what is Facebook worth? It started at $100 billion, dropped to slightly below $50 billion but it’s clearly a vigorous company so it may belt up,” Bekker said.

“I think a lot of people cashed out. We were not a direct shareholder, but [rather] indirectly..quite a lot of the investors that came in late simply maxed the share price on the IPO – which is never a great idea, because you leave a lot of people dissatisfied – and I think several people lost money,” Bekker added.

More than one billion Facebook shares held by employees, insiders and early investors are set to become available for trading by year’s end, according to a Reuters report.

The largest batch of additional shares became eligible to trade on November 14, when the lock-up expired on roughly 800 million shares.

Since its IPO, Facebook has faced a turbulent time in public trade, with the company’s stock price rising to an early high of $45.00, since dipping to a low of $17.55. The shares were listed at $38.00.

Facebook shares are currently trading at $26.15 on the NASDAQ, giving the group a market cap of $56.6 billion.

Naspers’ investments in a number of Internet companies include Chinese social media company, Tencent, which upped it’s monthly active instant-messaging accounts to 784 million – with an increase of peak simultaneous online users to 167 million.

Naspers, on Tuesday (27 November) reported  a 22% rise in revenue for the six months ended September 2012, to R22.6 billion, while overall managed internet businesses yielded trading profits of R3.1 billion.

The company’s Internet revenue improved 70% to R14.1 billion.

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Naspers: no faith in Facebook