Finally! Facebook Acquires WhatsApp for $16 Billion

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Mark-zuckerberg2Facebook has entered into an agreement to acquire WhatsApp, the popular messaging app, for $16 billion in cash and stock, according to a filing Wednesday.
The deal is by far Facebook's largest acquisition to date and comes after rumors in late 2012 and early 2013 that Facebook and Google were vying to buy the messaging service.
"WhatsApp is on a path to connect 1 billion people. The services that reach that milestone are all incredibly valuable," Mark Zuckerberg, Facebook's cofounder and CEO, said in a statement. "I've known Jan [Koum, WhatsApp cofounder] for a long time and I'm excited to partner with him and his team to make the world more open and connected."
WhatsApp is the most popular of a set of mobile messaging apps that some argued posed a threat to Facebook's business. The app lets users send messages for free across smartphone platforms and had proved particularly popular abroad and in emerging markets.
According to the filing, Facebook has agreed to pay $12 billion in stock and $4 billion in cash for the company. Facebook has also agreed to pay an additional $3 billion in restricted stock units to WhatsApp's founders and employees as part of the deal, which would bring the total deal price to about $19 billion.
If the deal doesn't go through, Facebook will pay a breakup fee of $1 billion to WhatsApp, which is still more than the total amount Facebook ended up paying to acquire Instagram.
Facebook stock declined by more than 4.5% in after hours trading following the announcement.
WhatsApp was founded by Koum and Brian Acton, two former Yahoo employees, in 2009. There are currently more than 450 million people who use the service each month, a larger user base than social networks like Twitter or LinkedIn.
Facebook has long been rumored to be looking to make a big acquisition in the messaging space, including a report that it offered to buy Snapchat for as much as $3 billion.
Koum, the cofounder and CEO, had repeatedly denied that the company was looking to be acquired. Then again, it's not everyday you get offered $16 billion. As part of the deal, he will join Facebook's board of directors.
WhatsApp will continue to operate independently, presumably in the same way as Instagram.

Below is a message from Facebook CEO, Mark Zuckerberg.. Enjoy!

Finally! Facebook Acquires WhatsApp for $16 Billion

I’m excited to announce that we’ve agreed to acquire WhatsApp and that their entire team will be joining us at 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 is a simple, fast and reliable mobile messaging service that is used by over 450 million people on every major mobile platform. More than 1 million people sign up for WhatsApp every day and it is on its way to connecting one billion people. More and more people rely on WhatsApp to communicate with all of their contacts every day.

WhatsApp will continue to operate independently within Facebook. The product roadmap will remain unchanged and the team is going to stay in Mountain View. Over the next few years, we're going to work hard to help WhatsApp grow and connect the whole world. We also expect that WhatsApp will add to our efforts forInternet.org, our partnership to make basic internet services affordable for everyone.

WhatsApp will complement our existing chat and messaging services to provide new tools for our community. Facebook Messenger is widely used for chatting with your Facebook friends, and WhatsApp for communicating with all of your contacts and small groups of people. Since WhatsApp and Messenger serve such different and important uses, we will continue investing in both and making them each great products for everyone.

WhatsApp had every option in the world, so I’m thrilled that they chose to work with us. I’m looking forward to what Facebook and WhatsApp can do together, and to developing great new mobile services that give people even more options for connecting.

I've also known Jan for a long time, and I know that we both share the vision of making the world more open and connected. I'm particularly happy that Jan has agreed to join the Facebook board and partner with me to shape Facebook's future as well as WhatsApp's.

Jan and the WhatsApp team have done some amazing work to connect almost half a billion people. I can’t wait for them to join Facebook and help us connect the rest of the world.

Comments

Brendon said…
But what happened to SnapChat? Shouldn't they be focus on that one first before acquiring other ventures? But I'm happy for the creators of WhatsApp. They're cool app gets people back to mobile. http://www.21stcenturynews.com.au/middle-class-immigrants-app-purchased-19-billion-facebook/
20 February 2014 at 07:49
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