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Facebook Acquires WhatsApp: Here is Everything You Would Like to Know

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The big news for today is from Facebook, the company has agreed to acquire the most used instant messaging service all around the world. Facebook acquires WhatsApp for $19 Billion and the WhatsApp team will now work with Facebook.

With the mission of connecting people around the world, Facebook has taken another initiative to make that possible. “Our mission is to make the world more open and connected. We do this by building services that help people share any type of content with any group of people they want. WhatsApp will help us do this by continuing to develop a service that people around the world love to use every day” – Mark Zuckerberg

450 Million people across the world use the WhatsApp application out of which 70% are active every day. If facts are to be believed, the users to this application are growing(currently adding more than 1 million new registered users per day).

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 as a brand will be maintained, its headquarters will still remain in Mountain View, CA. Jan Koum(WhatsApp co-founder and CEO) will join Facebook’s Board of Directors and WhatsApp’s core messaging product and Facebook’s existing Messenger app will continue to operate as standalone applications.

More Details

Upon closing of the deal, all outstanding shares of WhatsApp capital stock and options to purchase WhatsApp capital stock will be cancelled in exchange for $4 billion in cash and 183,865,778 shares of Facebook Class A common stock (worth $12 billion based on the average closing price of the six trading days preceding February 18, 2014 of $65.2650 per share). In addition, upon closing, Facebook will grant 45,966,444 restricted stock units to WhatsApp employees (worth $3 billion based on the average closing price of the six trading days preceding February 18, 2014 of $65.2650 per share). As of February 17, 2014, Facebook had 2,551,654,996 Class A and B shares outstanding plus approximately 139 million dilutive securities primarily consisting of unvested RSUs. The Class A common stock and RSUs issued to WhatsApp shareholders and employees upon closing will represent 7.9% of Facebook shares based on current shares and RSUs outstanding.

Why did Facebook Acquire WhatsApp ?

WhatsApp as an application has more than 315 Million active users each day. Facts say that the number of messages sent through WhatsApp is approximately the same as the total number of SMS traffic throughout the world. Not only here in India, but in countries like Brazil, Mexico and South Africa; WhatsApp is the most used messaging service.

WhatsApp team’s intentions of keeping the application ad free still remains, so we will have to see what change does Facebook brings to this app for generating revenue. For now, WhatsApp’s core messaging product and Facebook’s existing Messenger app will continue to operate as standalone applications

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