x Abu Dhabi, UAEMonday 22 January 2018

Twitter valued at $9bn as employees sell $80m in stock

Twitter was valued at about US$9 billion (Dh33.06bn) after early employees sold $80 million in shares to a fund managed by BlackRock

Twitter was valued at about US$9 billion (Dh33.06bn) after early employees sold $80 million in shares to a fund managed by BlackRock, said three people with knowledge of the matter.

The sales were overseen by the Twitter chief operating officer Ali Rowghani, said one of the people on Friday, who asked not to be identified because the transactions were private.

Twitter is helping early shareholders realise part of the value of their holdings while letting select investors obtain equity in the fast-growing internet company before it holds an initial public offering.

The deal with BlackRock, the largest money manager, marks an increase in the blog site's value since 2011, when an investment led by DST Global valued Twitter at $8bn.

Farrell Denby, a spokesman for New York-based BlackRock, declined to comment, as did Gabriel Stricker, a spokesman for San Francisco-based Twitter.

Mr Rowghani, who was promoted from the role of finance chief last month, has taken an active role in lining up buyers for shares, according to the person with knowledge of the matter.

In doing so, he may seek to limit pressure on Twitter's valuation that could result from employees dumping a large amount of stock after post-IPO "lockups" as their shares are lifted. A tighter rein on who holds stock can also limit the amount of inside information circulated ahead of an IPO.

The close involvement of Twitter in private share sales is a shift from the freewheeling marketplace for shares of Facebook that arose before its public offering last year.

On websites such as SecondMarketand SharesPost, Facebook shares were traded freely among employees and investors with little intervention from the company - often resulting in the exchange of confidential data about its financials and daily projections on its valuation that loomed over the IPO.

By contrast, Mr Rowghani and his team have turned away many potential buyers and limited access to Twitter's financials to a select few investors, said one person.

Twitter, founded in 2006, has sought to limit private-share sales in the past. In 2011, the company asked shareholders to refrain from selling on Web exchanges, two people said at the time. The company allocated half of its $800 million investment from DST for buying shares back from employees and investors, people said at the time. Twitter has not disclosed plans for a public-market debut, although Mr Rowghani's promotion was a possible precursor to an eventual IPO filing.

BlackRock's purchase and Twitter's valuation were first reported by the Financial Times.

* Bloomberg News