Facebook buys WhatsApp for US$19 billion
Deal bolsters the world’s biggest social network by adding messaging service's 450 million users
Facebook will buy fast-growing mobile-messaging startup WhatsApp for US$19 billion in cash and stock in a landmark deal that places the world’s largest social network closer to the heart of mobile communications and may bring younger users into the fold.
The transaction involves US$4 billion in cash, US$12 billion in stock and US$3 billion in restricted stock that vests over several years.
The WhatsApp deal is worth more than Facebook raised in its own initial public offering and underscores the social network’s determination to win the market for messaging.
Founded by a Ukrainian immigrant who dropped out of college, Jan Koum, and a Stanford alumnus, Brian Acton, WhatsApp is a Silicon Valley start-up fairy tale, rocketing to 450 million users in five years and adding another million daily.
“No one in the history of the world has ever done something like this,” Facebook chief executive Mark Zuckerberg said on a conference call on Wednesday.
Zuckerberg, who famously closed a US$1 billion deal to buy photo-sharing service Instagram over a weekend in mid-2012, revealed on Wednesday that he proposed the tie-up over dinner with WhatsApp chief executive Koum just 10 days earlier, on the night of February 9.