Facebook rejected Microsoft's $15B offer

Microsoft exec details company's failed bid to buy Facebook in 2007

At a tech conference in Paris on Friday, a Microsoft executive confirmed that the company made a failed bid to buy Facebook three years ago.

Mark Zuckerberg, CEO of Facebook, turned down an offer of $15 billion from Microsoft CEO Steve Ballmer, according to Fritz Lanman, Microsoft's senior director of corporate strategy and acquisitions. Lanman divulged information about the failed deal while speaking at the LeWeb tech conference earlier today.

"Yeah, we tried to acquire Facebook," Lanman said during an onstage interview, according to a report by TechCrunch. "Facebook had a lot of similarities to Microsoft back in the day."

Lanman added that when Facebook rejected Microsoft's offer, Microsoft instead invested $240 million for a small stake in the company.

Microsoft and Facebook continue to work together. In October they announced that they were teaming up to make search more social. As part of that partnership, Facebook's search, which is powered by Microsoft's Bing, is making it easier to find people on the social networking site.

Lanman said Facebook could one day be worth as much as Microsoft.

"It's easy to say that Microsoft missed a huge opportunity in not buying Facebook when Ballmer met with Zuckerberg," said Dan Olds, an analyst at Gabriel Consulting Group. "But Microsoft offered a huge amount of cash and was repeatedly turned down. Since it's a private company, the best [Microsoft] could do was to take a small stake for $240 million."

And Zuckerberg's decision may have been a good one for the fledgling company. "Who's to say that Facebook would have been nearly as successful if Microsoft had bought them and taken over?" Olds asked. "For all we know, Microsoft might have screwed it up."

Sharon Gaudin covers the Internet and Web 2.0, emerging technologies, and desktop and laptop chips for Computerworld. Follow Sharon on Twitter at @sgaudin, or subscribe to Sharon's RSS feed . Her e-mail address is sgaudin@computerworld.com.

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