According to Fritz Lanman, Microsoft's senior director of corporate strategy and acquisitions, Mark Zuckerberg, CEO of Facebook, turned down the offer from Microsoft's CEO Steve Ballmer . Lanman divulged information about the failed deal while speaking at the LeWeb tech conference in Paris.
"Yeah, we tried to acquire Facebook," Lanman said, according to a report by TechCrunch. "Facebook had a lot of similarities to Microsoft back in the day."
Lanman added that when Facebook rejected Microsoft's offer, Microsoft instead invested $240m for a small stake in the company.
Microsoft and Facebook continue to work together, announcing in October that they were teaming up to make search more social. As part of this partnership, Facebook's search, which is powered by Microsoft's Bing, is making it easier to find people on the social networking site.
Lanman said Facebook could one day be worth as much as Microsoft.
"It's easy to say that Microsoft missed a huge opportunity in not buying Facebook when Ballmer met with Zuckerberg," said Dan Olds, an analyst with The Gabriel Consulting Group. "But Microsoft offered a huge amount of cash and was repeatedly turned down. Since it's a private company, the best [Microsoft] could do was to take a small stake for $240m."
And Zuckerberg's decision may have been a good one for the fledgling company. "Who's to say that Facebook would have been nearly as successful if Microsoft had bought them and taken over?" Olds asked. "For all we know, Microsoft might have screwed it up."