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"Deutsche might be able to get a favorable valuation because Citigroup has problems of its own".
Mr. Falk said the company was obligated to disclose the internal valuation, because it was "material" to the agreement.
Such a computer would be worth a pittance under a forward-looking valuation because the prices of computers have sharply dropped.
The size of the offering is likely to be a relatively small percentage of LinkedIn's overall valuation because company insiders like its founder, Reid Hoffman, are not expected to sell large holdings, people briefed on the matter said previously.
"V.C.'s can create this mark-to-mystery valuation because as long as there are no numbers, I can have whatever mark I want for an external valuation of a start-up," Mr. Kedrosky said.
In its most recent letter to investors, Southeastern took pains to justify its significant exposure, writing that A.C.S. "sells for approximately half of our valuation because the market oversimplifies this as a Spanish business with optically high leverage".
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Are many investors ignoring valuations because of faith in a social networking revolution and LinkedIn's disruptive potential?
"Privatized companies usually come out at attractive valuations because there's an awful lot to sell," he said.
Are you likely to receive higher valuations because of the brand, and because you're plugging into the network?' Across the board, they said yes".
What's more, there is evidence that such rules lead to higher stock valuations because they suggest a commitment by managers not to abuse shareholders.
The S.E.C. said that those purchases were made at misleading valuations, because Mr. Stiefel knew that the company was worth far more based on his conversations with Blackstone and other potential investors.
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