Facebook buys WhatsApp for US$19b in cash, stock

Facebook buys WhatsApp for US$19b in cash, stock

NEW YORK:  Facebook is buying mobile messaging service WhatsApp for up to  US$19 billion in cash and stock, by far the company’s largest acquisition.

The world’s biggest social networking company said Wednesday that it is  paying US$12 billion in Facebook stock and US$4 billion in cash for WhatsApp. In  addition, the app’s founders and employees will be granted US$3 billion in  restricted stock that will vest over four years after the deal closes.
The deal translates to roughly 9 per cent of Facebook’s market value and  is bigger than any acquisition made by Google, Apple or Microsoft.
Google’s biggest deal, Motorola Mobility, stood at US$12.5 billion, while  Microsoft’s largest was Skype at US$8.5 billion. Apple, meanwhile, hasn’t done a  deal above US$1 billion.
Facebook says it is keeping WhatsApp as a separate service, just as it did  with Instagram, which it bought for about US$715.3 million.
WhatsApp has more than 450 million monthly active users. In comparison,  Twitter had 241 million users at the end of 2013.
Facebook chief executive Mark Zuckerberg says WhatsApp is on path to reach  a billion users.
“The services that reach that milestone are all incredibly valuable,” Zuckerberg said.
Shares of Facebook slid US$1.12 to US$66.94 in extended trading after the  deal was announced.
— New Straits Times, 20 Feb 2014

 

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