The Facebook board has approved a plan to buy additional shares worth $ 9 billion. The shares are at the top of a $ 15 billion stock buyout program launched last year.
Companies usually offer additional shares when they want to raise their capital for project financing, but it seems that Facebook has not found anyone buying those shares, which have fallen about 40% since late July, influenced by a steady wave of bad news including, but not limited to - :
- Not to act on Russia's attempts to influence the US presidential election in 2016.
- Allow the site to play a role in fueling ethnic and religious violence in many countries, including Myanmar.
- Allow advertisers to target users according to specific categories.
- Communicate data selectively with other companies to give partners the advantage and punish competitors.
- Denial and distraction When I first came to light the news of these multiple scandals.
- Public concern about social media and smart phones that harm the mental health of a generation of children (and their parents).
When the company does not find a buyer for such shares, it buys them on its own in order to preserve its reputation on the one hand, and to achieve the goal of raising the value of its capital on the other hand.
As of the fourth quarter, the company had about $ 41 billion in cash, so it had the resources to buy a lot of equity if it felt the need.
The company's announcement gave its shares a boost after hours of trading on Friday, but the company's shares are still down about 20% so far this year, putting the market value at around $ 390 billion.