Announce: Facebook Buys WhatsApp for $19 Billion

Facebook just made its boldest business move ever, buying the mobile-messaging service WhatsApp in a deal worth some $19 billion in cash and stock.

See also:  Facebook accused for Faking Your Likes

If you can’t beat em, buy them. That’s what the board at Facebook has decided. In another high profile acquisition, the company has acquired WhatsApp for a whopping $19 billion. Facebook would pay $4 billion in cash and another $12 billion in Facebook shares. Another $3 billion would be paid in restricted stock that will vest over the four years after the deal’s closing.
WhatsApp is a popular cross platform messaging service with over 400 million active users a month. It is by far the biggest player in the market, ahead of WeChat, Line and even Facebook Messenger. Earlier rumors last year said that WhatsApp was in talks with Google for an acquisition in a deal pegged at $1 billion. However, the size of this new deal dwarfs that figure. The acquisition also comes less than a week after Rakuten acquired another popular cross platform messenger Viber for $900 million.
WhatsApp, which relies on yearly subscription fee for revenue will continue to operate independently even after the sale. What’s more, the company CEO will be joining the Facebook board of directors. Although it remains to be seen how Facebook will be able generate revenue out of the huge userbase, since WhatsApp doesn’t show any ads, until now that is.
Source: blog.whatsapp

Have something to add to this story? Share it in the comments.