Facebook is buying mobile messaging
service WhatsApp for up to $19 billion in
cash and stock, by far the company's
largest acquisition.
The world's biggest social networking
company said that it is paying $12 billion
in Facebook stock and $4 billion in cash
for WhatsApp.
In addition, the app's founders and
employees will be granted $3 billion in
restricted stock that will vest over four
years after the deal closes.
Facebook says it is keeping WhatsApp as a
separate service, just as it did with
Instagram, which it bought for about
$715.3 million.
WhatsApp has more than 450 million
monthly active users. In comparison,
Twitter had 241 million users at the end
of 2014.
Facebook CEO Mark Zuckerberg says
WhatsApp is on path to reach a billion
users.
As part of the deal, WhatsApp co-founder
and Chief Executive Jan Koum will join
Facebook's board, and the social network
will grant an additional $3 billion worth of
restricted stock units to WhatsApp's
founders, including Koum.
'We're excited and honoured to partner
with Mark and Facebook as we continue
to bring our product to more people
around the world,' Mr Koum said in a
statement.
Also, Facebook promised to keep the
WhatsApp brand and service, and
pledged a $1 billion cash break-up fee
were the deal to fall through.
Shares in Facebook slid 5 percent to
$64.70 after hours, from a close of $68.06
on the Nasdaq.
Facebook was advised by Allen & Co,
while WhatApp has enlisted Morgan
Stanley for the deal.
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