14 DAY TRIAL // Facebook has just announced that it has agreed to acquire the messaging service WhatsApp for around $16 billion (€13.8 billion), including $4 billion (€2.9 billion) in cash and approximately $12 billion (€8.7 billion) worth of Facebook shares.
Moreover, Facebook has confirmed that an additional $3 billion (€2.2 billion) in restricted stock units will be granted to WhatsApp’s founders and employees over the next 4 years subsequent to closing.
The acquisition will provide Facebook with access to WhatsApp's more than 450 million users, of which 70% are active on a given day.
This is one of the biggest transactions implying two social media giants. WhatsApp is one of the few companies that did not raise subsequent rounds of funding from investors and the only one we know of dates back to 2011, when Sequoia Capital invested about $8 million for around 10 to 20% shares.
Over the course of the years, Sequoia's investments have increased to around $60 million, but the company is now receiving more than $3 billion in cash and stock for this investment.
Under agreement, Facebook has also announced that WhatsApp Co-Founder and CEO Jan Koum will be joining its board of directors. Facebook has confirmed that it will host a 30-minute conference call to discuss the acquisition at 3:00 pm PT / 6:00pm ET today.
However, both Zuckerberg and Koum have been approached by various analysts to find out what exactly the deal means to WhatsApp users and if ads were coming to the messaging service.
Well, according to Koum, the two companies are now more focused on reaching more customers than on making money from the service.
Facebook's Mark Zuckerberg has also partly responded to the question in a long post on Facebook (obviously): “WhatsApp will continue to operate independently within Facebook. The product roadmap will remain unchanged and the team is going to stay in Mountain View.”