U.S. ad holding company Interpublic Group of Cos. has sold the remainder of its shares in Facebook for net cash proceeds of $95 million.
The company is said to have paid less than $5 million six years ago for its initial investment in Facebook (estimated to have represented less than 0.5% of the social network).
During a conference call this summer with analysts this summer, Interpublic Chairman-CEO Michael Roth noted that the company was sitting on 4.4 million shares in Facebook, about half its initial stake. At that time those shares were valued at more than $120 million.
The company sold about half of its original stake in private markets last August for $133 million. It was restricted from selling off the remaining shares until this month. Mr. Roth earlier this year suggested that because the investment in the social network wasn't strategic, as long as the company's board permitted it, Interpublic would likely sell as it would be an opportunity to return money to shareholders.
"The value of the investment we made in Facebook in 2006 has increased significantly during the last six years," Mr. Roth said in a statement. "We decided to sell our remaining shares in Facebook as our investment was no longer strategic in nature. Simultaneously, our board has authorized an increase in our share repurchase program of $100 million. We view this as another opportunity to enhance shareholder value reflecting the confidence we have in our company." The increase in the share repurchase program takes it to $400 million from $300 million.
Last month Interpublic reported a disappointing third-quarter. Its revenue dropped 3.2% $1.67 billion, in part because of weaker client spending. In the U.S., the drop was more pronounced, with revenue falling 5.5%. Third quarter net income was $68.7 million, down from $208.1 million a year ago, though the year-ago-number had been buoyed by the initial sales of Facebook shares.