Sorry, Stock Markets — No Facebook IPO This Year

Facebook, according to comments made by two of the social networking company’s financial backers at the DTD conference in Germany (reported in a live-blog of the conference as well as by Rafat Ali of paidContent on his Twitter stream), is not planning an IPO this year. “I am happy to announce that there will be no near-term IPO on Facebook — this means 2010,” Jim Breyer of Accel Partners reportedly told the conference, adding that “for them, it is all about getting the product and team right.” Facebook investor Yuri Milner of Russia’s Digital Sky Technologies, meanwhile, was quoted as saying: “We have permanent capital, we don’t have to return money to investors, so we have unlimited patience.” Milner has expressed similar sentiments in the past.

Such a sentiment is likely to come as a disappointment to many in the investment markets, since a Facebook IPO would have been a nice boost for the somewhat moribund initial public offering market. A share issue by the social network could be worth upwards of $10 billion, depending on whose valuation methods you decide to use (some are as high as $14 billion). There also seems to be some debate among investment industry observers about whether the IPO market is coming back any time soon.

An IPO by Facebook is viewed by many as the most hotly-awaited technology stock offering since Google went public in 2004, and there have been signs that the social network is at least considering a public share issue, including a restructuring of the company’s capital structure to create two classes of stock, something that is often a prelude to an IPO. However, at the time it made the changes, Facebook made a point of saying that the move should not be “construed as a signal the company is planning to go public,” and that it “has no plans to go public at this time.”

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