Home Business News Facebook makes biggest ever acquisition for $19bn WhatsApp

Facebook makes biggest ever acquisition for $19bn WhatsApp

by LLB Reporter
20th Feb 14 9:09 am

Facebook has made its biggest ever acquisition, shelling out an eye-watering $19bn for messaging app WhatsApp: $4bn in cash, $12bn in Facebook shares and $3bn in restricted stock.

WhatsApp lets its 450 million monthly users send text messages for free by using internet connection rather than your phone network – a bit like how Skype lets you make free calls over the web.

Staggeringly, WhatsApp’s messaging volume is nearing the amount of all SMS text messages sent across the planet across all telco networks.

Some 70% of its users use the app on a daily basis.

“WhatsApp is on a path to connect one billion people,” said Mark Zuckerberg, Facebook founder and CEO, in a statement. “The services that reach that milestone are all incredibly valuable.”

The app makes money by charging users a $1 subscription fee per year, though there is also a free version.

Jan Koum, WhatsApp co-founder and CEO, said: “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.”

WhatsApp’s founders and employees are in line to get $3bn of the shares as restricted stock.

Follow me on Twitter @sophiehobson and @londonlovesbiz

NOW READ: 13 companies Google gobbled up in 2013 and 2014

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