Facebook purchases WhatsApp for $16 billion

Facebook has acquired the hugely popular WhatsApp cross-platform messaging application for a cool $16 billion. This includes $12 billion worth of Facebook shares and $4 billion in cash. Jan Koum, WhatsApp co-founder and CEO, will join Facebook’s Board of Directors.

At the moment, WhatsApp has more than 450 million monthly users combined  across Android, iOS, Windows Phone, BlackBerry and even select Asha and Symbian devices.

According to Facebook, the acquisition will boost its “ability to bring connectivity and utility to the world.” However Facebook made it clear that “WhatsApp's core messaging product and Facebook's existing Messenger app will continue to operate as standalone applications.”

"WhatsApp is on a path to connect 1 billion people. The services that reach that milestone are all incredibly valuable. I've known Jan for a long time and I'm excited to partner with him and his team to make the world more open and connected." 

Mark Zuckerberg.

As the old saying goes, if you can’t beat them, join them - or, in Facebook’s case, buy them.


source - Facebook

[UPDATE #1]
Final price of WhatsApp exceeds $21 billion as Facebook deal closes

According to an SEC 8-K form filed by Facebook, the purchase of WhatsApp, which was originally set at $16 billion has ballooned to a final tally of $21.8 billion. The deal was originally agreed in February, and the higher acquisition price is due to the appreciation in Facebook's stock since the deal was announced.

Facebook announced on Monday that WhatsApp co-founder and CEO Jan Koum, will join Facebook's board of directors. If Koum stays with the company for a period of four years, he will receive shares currently worth $1.9 billion. But in lieu of this, Koum will be making just $1 a year at Facebook.

Facebook CEO Mark Zuckerberg says that Facebook will not make many changes to the messaging app in the short term, and will not add advertising on the service. WhatsApp is currently free for the first year with subscribers paying $1 a year thereafter. So far, Facebook has shown a willingness to let its recent acquisitions, such as Instagram, operate autonomously.

source - SEC via FierceWireless