Zuckerberg May Sell Out $1.67 Billion Facebook Stocks to Pay Off Taxes!
Facebook CEO Mark Zuckerberg may sell about $1.67 billion of Facebook Inc. stock in the company’s IPO to pay off taxes he will owe when he would choose the options to buy 120 million shares.
Facebook founder Zuckerberg will be obliged taxes on gains related to the award of options, as disclosed by the Menlo Park, California-based social network in its IPO prospectus. The rights were granted to Zuckerberg in 2005 and will expire in 2015, and he’ll sell stock to cover liabilities, Facebook said.
“We expect that substantially all of the net proceeds Mr. Zuckerberg will receive upon such sale will be used to satisfy taxes that he will incur upon his exercise of an outstanding stock option to purchase 120,000,000 shares” of common stock, according to the filing.
By filing IPO on 1st February, his social network “Facebook” is going to raise as much as $5 billion, disclosing the company’s worth of about $75-100 billion, as expected by market experts.
If the experts’ opinion is correct, Facebook would hold about 2.51 billion shares each valued at about $39.79. Also, the awarded shares would have a value of 6 cents accordingly. If we predict that Mr. Zuckerberg buys all 120 million shares at that price, he would have a gain of about $4.77 billion in this big deal.
Victor Fleischer, associate professor of law at the University of Colorado estimates that Zuckerberg’s tax rate will be 35 percent, meaning his bill would hit an amount of $1.67 billion.
At this stage, Larry Yu, a spokesman for Facebook, declined to comment on this report.
According to many tech experts and stock gurus, the social network Facebook has a worth of about $94 billion, meaning about $40 a share.