is in final negotiations with social networking site Facebook for a 0.5
percent stake in the site in return for spending up to $10 million for
the agency’s clients on Facebook, reports MediaWeek.
Obviously, the implication is a $2b valuation, validating the earlier rumors that Facebook had pushed for such a number when they turned down a $750m Viacom offer.
However, looking at the size of the deal, I think the equity part of the deal is a bit of a farce. IPG is not a holding company of marketing services providers. I don’t think they look at this as an equity investment, but rather an experimental media buy, or a biz dev deal. However, by attaching an equity stake in the deal, at their own terms, Facebook puts itself in the books at a $2b valuation.
To me it looks like a prophecy they hope that will be self-fulfilling.