Facebook’s floatation values company at between £53 billion and £59 billion

Facebook has set the share price for its upcoming floatation at between £17.5 ($28) and £21.8 ($35) per share, valuing the company at between £53 billion and £59 billion. The floatation will be the largest ever for an technology company- bigger than Google’s valuation of £14.3 billion in 2004.

Facebook is set to list on the Nasdaq and would rival Amazon’s and Cisco System’s current market capitalisation.

The shares are expected to start trading under the symbol “FB” on 18 May.

Roughly 15% of the business is being sold, which is expected to raise about £8.75 billion for the company.

The eight year old social network has 900 million users worldwide and made a profit of £600 million last year.

There is expected to be a huge take up, though some investors have voiced concerns about the company’s longer-term growth with Facebook last week reporting its first drop in revenue between quarters for two years.

But during a video presentation yesterday Facebook executives sought to allay those concerns, pointing to mobile as an area for growth that the company will invest heavily in.

Last month Facebook announced that it would buy the fast growing mobile phone photo sharing app Instagram for $1bn, its largest purchase ever.

Although the valuation still exceeds a price earnings (pe) of around 90- it is lower than Facebook was trying to tout recently of around 100.

Facebook founder and chief executive Mark Zuckerberg has rigged the voting rights and will remain in control of the company even after the floatation, controlling more than 57.3% of the voting power although he will only own 31.5% of Facebook’s outstanding shares.

As to whether the company is worth a punt only time will tell, but overhyped company floatations have a history of falling heavily in the hours and days after the initial surge of enthusiasm.