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.
 |
| WhatsApp co-founder and Chief Executive Jan Koum |
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.
Source: Mail online