Microsoft Corp Chief Executive Steve Ballmer said on Monday his firm's acquisition of a 1.6 percent stake in socializing Web site Facebook for $240 million was an important investment, not a mistake.

"We didn't make a mistake," Ballmer told reporters on the sidelines of a business conference in Mumbai.

Analysts have said Microsoft paid a steep price on a bet that the three-year-old firm would be able to transform itself into a hub for all sorts of Web activity.

"The valuation of Facebook is still to be determined. Certainly today, it's very, very popular. So for a company like ours that wants to be a pre-eminent presence in this space, it's very important for us," Ballmer said.

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Microsoft, Steve Ballmer, Facebook, Social Media, Social Networking