Facebook to go public

Social-networking site, Facebook has filed to raise $5bn in a much anticipated initial public offering. The IPO would be Silicon Valley's largest-ever.

With over 845 million active users, the world's largest social network said in a preliminary filing on Wednesday that its net income rose 65 per cent to $1bn in 2011 from a revenue of $3.71bn.

Patrick Tucker, deputy editor of the Futurist magazine, says Facebook is easily worth the $5bn price tag. The vast amounts of data produced on the social network "is outrageously valuable and transcends a monetary value" as a potential source of social information and advertising insights for large corporations.

Al Jazeera's Rob Reynolds, reporting from Los Angeles says for advertisers the data generated through Facebook likes and statuses can be extremely useful.

"You know as an advertiser that person you're going after is probably interested in the product or service you are selling", our correspondent said.

The long-awaited submission will kick off a months-long process that will culminate in an event not seen since the heyday of the dotcom boom in the late 1990s and the bust of the early 2000s.

The Palo Alto-based social network has appointed Morgan Stanley, Goldman Sachs and JP Morgan as its lead underwriters.

Bank of America, Merrill Lynch, Barclays Capital and Allen & Co. will also have stakes in the much talked about coming out party. The long sought after IPO means that "even the people who do get shares are not going to get as many as they want", when the company does go public says our correspondent.

Facebook had previously been expected to raise $10bn in what would have been the fourth-largest IPO in US history, after Visa Inc, General Motors, and AT&T Wireless, according to Thomson Reuters data.

Now the world's largest social networking site, originally dubbed "The Facebook" started out as a dorm room project for Harvard dropout Mark Zuckerberg as a way for university students to connect with one another. Within eight years the service would expand its user-base beyond colleges and vault into the top echelon of the Silicon Valley power-players.