Microsoft and Google are understood to be fighting over a $1.5 billion (£732.4 million) stake in Facebook, in a deal that would value the social networking site at as much as $15 billion.

It is expected that the sale of a 10 per cent holding in the private company will be sealed within the next 48 hours.

Microsoft and Google both want a share of Facebook because of the hundreds of millions of dollars of advertising revenue the networking site attracts.

Key to the agreement between the successful new shareholder and Facebook is thought to be a deal where the investor would handle all the site's overseas advertising sales.

While the site, which allows members to chat online and post data such as photographs, is free to users, it makes money from advertisers on its web pages.

Executives from both companies travelled to Facebook's headquarters in Palo Alto this week. It is understood that Tim Armstrong, Google's head of advertising sales, is helping lead the talks on behalf of the search engine with Facebook.

It is thought that Facebook's investors, which include Accel Partners and Greylock Partners, are holding out for a valuation of the networking site of at least $10-15 billion.

At the top end of the valuation, a 10 per cent stake would cost either technology group $1.5 billion.

Should Google win the race and seize the stake, it is expected that they will insist that an existing advertising agreement between Microsoft and Facebook is unwound.

Should Microsoft win, it is expected that they will seek to expand the deal. A 10 per cent shareholder is also expected to get a seat on the Facebook board.

While both companies could easily afford to spend $1.5 billion on the stake, it is more likely that both would seek external funding from a financial partner.

Mark Zuckerberg, founder and chief executive of Facebook, opened the networking site up to users beyond its original college student base, only a year ago.

Since then its user base has ballooned to more than 47 million people. Facebook competes with its larger rival MySpace which has 100 million users.

It is thought that Mr Zuckerberg is planning on preparing the company for a float.

Rupert Murdoch, head of News Corporation - parent of The Times and owner of MySpace, last week ruled out buying Facebook because he said it was overvalued. News Corporation bought MySpace for $580 million in 2005.

Earlier this month, Facebook opened the door to outside developers for the first time, attracting 4000 applications. Facebook will allow these developers to profit from their applications, which include games, widgets, and other more practical tools. The move is expected to help increase Facebook's value further.

Microsoft said that it refused to comment on rumour and speculation. Google failed to return calls.

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