Facebook To Acquire WhatsApp For $16 Billion

Posted on Feb 19 2014 - 6:13pm by Chad Buenaflor

Facebook announced today that it has reached an agreement to acquire WhatsApp for approximately $16 billion. This amount includes $4 billion in cash and $12 billion in Facebook shares. Aside from this, the deal also includes an additional $3 billion in restricted stock units that will be given to WhatsApp founders and employees.

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Facebook CEO Mark Zuckerberg said that “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 co-founder and CEO Jan Koum commented on this deal saying that “WhatsApp’s extremely high user engagement and rapid growth are driven by the simple, powerful and instantaneous messaging capabilities we provide. We’re excited and honored to partner with Mark and Facebook as we continue to bring our product to more people around the world.”

When this deal is closed all shares of WhatsApp will be exchanged for $4 billion in cash and 183,865,778 shares of Facebook Class A common stock with an estimated value of $12 billion. Facebook will also give 45,966,444 restricted stock units which is worth around $3 billion to WhatsApp employees.

If the deal does not push through for whatever reason then Facebook will have to pay WhatsApp $1 billion in cash plus $1 billion worth of Facebook Class A common stock.

In the latest blog post of WhatsApp the company announced that “WhatsApp will remain autonomous and operate independently. You can continue to enjoy the service for a nominal fee. You can continue to use WhatsApp no matter where in the world you are, or what smartphone you’re using. 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.”

Facebook also confirmed that WhatsApp will remain independent however integration with the social giant may come over time.

There are more than 450 million people all over the world who use WhatsApp every month. An estimated 70 percent of the total number of users are active on any given day.

via facebook

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About the Author

Chad Buenaflor is a tech writer, gadget reviewer and blogger. In his free time he likes to watch movies, listen to music and play chess. You can reach him at his Google+ social media account