Technology - Main

Facebook to acquire WhatsApp for $16B

20 Feb 2014 - {{hitsCtrl.values.hits}}

The social network is throwing down billions of dollars of cash and stock to buy the messaging app that has already ballooned to a third of Facebook's size.

Facebook said Wednesday that it has agreed to acquire WhatsApp in a $16 billion cash and stock arrangement with the popular messaging application's parent company. The announcement was made in a filing with the Securities and Exchange Commission.

The deal for WhatsApp includes 183,865,778 shares of Facebook stock, valued at $12 billion, along with $4 billion in cash. Once the acquisition closes, Facebook has promised to grant 45,966,444 restricted stock units (RSUs) to WhatsApp founders and employees, tacking on an additional $3 billion in value to the deal. The additional RSUs will vest over four years following closing.

"I'm excited to announce that we've agreed to acquire WhatsApp and that their entire team will be joining us at Facebook," Facebook CEO Mark Zuckerberg said in a post published to Facebook. "Our mission is to make the world more open and connected. We do this by building services that help people share any type of content with any group of people they want. WhatsApp will help us do this by continuing to develop a service that people around the world love to use every day."

WhatsApp has 450 million monthly active users, more than 70 percent of whom are active on a daily basis, Facebook said in a press release. The service is also adding 1 million new registered users per day. The application will, much like Instagram, remain independent from its new parent company.

The astronomical price tag demonstrates just how eager the social network is to subsume one of its largest challengers -- at least in terms of audiences. Though largely focused on member-to-member messaging, 5-year-old WhatsApp is grown to be greater than one-third the size of Facebook and offers a more insular social networking experience beloved by youngsters and foreigners.

The network gives Facebook an important asset as it seeks to conquer the rest of world and maintain high engagement rates, but WhatsApp won't become another channel for ads -- at least, according to founder and CEO Jan Koum, who will also be joining Facebook's board of directors.

"You can continue to use WhatsApp no matter where in the world you are, or what smartphone you're using," Koum said. "And you can still count on absolutely no ads interrupting your communication. There would have been no partnership between our two companies if we had to compromise on the core principles that will always define our company, our vision and our product.

(Source : news.cnet.com)

Technology - Main

Facebook to acquire WhatsApp for $16B

Most Popular Articles

Diplomatic gaffes embarrass Lanka’s friendly nations: Sunday Times

People have complete right to lie: Kottahachchi

Hybrid vehicle import tax based on engine capacity will reduce costs, satisfy all

Sri Lankan jailed for murdering wife with axe in front of their children

Namal responds to allegations of preferential treatment in law exam

IMF agrees to raise income tax threshold: President

LATES'T NEWS

MR received death threats from ISIS, LTTE: Manoj Gamage

Christmas decorations in Colombo

Sri Lanka to move forward with Kfir jet upgrades despite concerns

Govt committed to combating underworld, drug trafficking but not for show

Senesh Bandara resigns as Rupavahini Chairman