Social-networking site Facebook has sold a 1.6 per cent stake to Microsoft for $240 million (€167 million) after spurning a competing offer from Google.
After weeks of negotiations, the investment announced yesterday values the social networking site at $15 billion. The site started in a Harvard University dorm room less than four years ago.
Microsoft will sell internet ads for Facebook as the site expands outside the United States, broadening a marketing relationship that began last year.
Besides validating founder Mark Zuckerberg's decision to rebuff a $1 billion takeover offer from Yahoo last year, Microsoft's money should be more than enough to pay for Facebook's ambitious expansion plans until the privately held company goes public.
Mr Zuckerberg (23), has indicated he would like to hold off on an initial public offering for at least two more years.
Facebook hopes to become an advertising magnet by increasing its worldwide audience of nearly 50 million active users, who connect with friends on the site through messaging, photo-sharing and other tools it offers.
Although News Corp's Myspace.com remains the largest social network, Facebook has been growing much faster the past year. Facebook attracted 30.6 million US visitors during September compared with 68.4 million at Myspace.
Microsoft's social networking arena - Windows Live Spaces - attracted 9.8 million US visitors.