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Facebook founder and CEO Mark Zuckerberg is selling $2.3 billion (Rs 14,269 crore) worth of his company’s shares to pay his taxes.
Zuckerberg, along with Facebook board member Marc Andreessen are going to offer about $3.9 billion, which includes 27 million Facebook shares and additional 41.35 million sharesby the CEO, stuff.co.nz reported on Friday.
The follow-on sale, first since the company’s public debut in May last year, is expected to raise $3.9 billion.
Facebook is set to join the Standard & Poor’s 500 Index, an event that triggers demand from index funds and other institutions to own a company’s stock.
Todd Lowenstein, portfolio manager with Highmark Capital said that it is never a positive sign when insiders dump big quantities of stock.
However, he pointed that the company is now being added to the S&P 500 Index and so there will be large demand for the shares from index buying and index hugging money managers and the latest move will be absorbed without much disruption.
Facebook will use the proceeds for corporate purposes, while Zuckerberg would use the majority of his proceeds to pay taxes.