Microsoft poised to buy stake in Facebook

NEW YORK - Reports have emerged that Microsoft is considering buying a five per cent stake in social networking site Facebook at a valuation of up to $500 million.

The price would value the company at $10 billion, well above the $1.6 billion paid by Google to acquire YouTube. Neither Microsoft nor Facebook have commented on the speculation.

The development comes after Yahoo attempted to buy the site for $1 billion last year. Microsoft already supplies display advertising to Facebook, but is seen by some as a relatively weak online presence.