Facebook announced Tuesday that it has received an infusion of $200 million from Digital Sky Technologies, a Russian Internet firm, which has a 1.96% ownership in Facebook. This now valuates Facebook at $10 billion and adds Digital Sky as the second company to invest heavily in Facebook after Microsoft acquired 1.6% of Facebook for $240 million in 2007 and rights to Facebook search & advertising spots.
Under the terms of the deal, Digital Sky will not receive a seat on the board at Facebook and will be acquiring $100 million of common shares from Facebook employees (current and former) who are looking to move some of their holdings in the company.
One might think that the mix of Russia and Facebook may not make much sense, but it is a safe investment for Digital Sky, which is not asking for much in return, and Facebook has become quite popular in Russia over the past 6 months as domestic social networks seem to be having problems keeping up with Russian demand for social connecting and photo tagging online.
Digital Sky also has interests in Mail.ru (the largest portal in Russia) and other Russian and Eastern European social networks like Odnoklassniki.ru (which is similar to MySpace) and VKontakte, which is almost just like Facebook.