Facebook will acquire WhatsApp for $16 billion in cash and stock, Bloomberg News reports. According to the SEC filing on Wednesday, WhatsApp founder and CEO Jan Koum will join Facebook's Board of Directors as part of the deal. For perspective on that price tag, Facebook tried (and failed) to buy Snapchat for $3 billion. And it purchased Instagram for $1 billion.
The deal breaks down to about $4 billion in cash and $12 billion in stock for the mobile messaging service, with an additional $3 billion in restricted stock units. In a statement, Facebook explained its interest in the company. For one thing, WhatsApp's messaging volume is approaching that of the "entire global telecom SMS volume," and that it adds about 1 million users a day. Right now, the service has 450 million active users any given month, and 70 percent of those are active on any given day. Here's more:
The acquisition supports Facebook and WhatsApp's shared mission to bring more connectivity and utility to the world by delivering core internet services efficiently and affordably. The combination will help accelerate growth and user engagement across both companies.
As part of the deal, WhatsApp will operate independently and keep its brand. Facebook's Messaging app will keep operating on its own. In a statement, WhatsApp said that "nothing" will change for its users as a result of the deal. They added:
You can continue to enjoy the service for a nominal fee. You can continue to use WhatsApp no matter where in the world you are, or what smartphone you’re using. And you can still count on absolutely no ads interrupting your communication.
This article is from the archive of our partner The Wire.