WhatsFace: Facebook to snap up WhatsApp for $19B in cash, stock


Boom! Did you see that coming? Facebook says that it has reached an agreement to acquire WhatsApp, for a total of about US$16-billion, including US$4-billion in cash and another US$12-billion in Facebook stock. On top of that, an additional US$3-billion in restricted stock will be granted to WhatsApp’s founders and employees that will vest over four years. All 32 members of WhatsApp will become Facebook employees.

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Mark Zuckerberg says that WhatsApp will operate independently within Facebook, but that the 450-million strong chat network will complement Facebook’s existing chat and messaging services to provide new tools for its community. While Facebook Messenger is used for communication within Facebook’s virtual walls, WhatsApp casts its net wider. “Since WhatsApp and Messenger serve such different and important uses, we will continue investing in both and making them each great products for everyone,” says Zuckerberg.

He adds that WhatsApp is also likely to play a part in Internet.org, Facebook’s partnership to make basic internet services affordable for everyone.

WhatsApp CEO, Jan Koum assured WhatsApp users that nothing would change.

“WhatsApp will remain autonomous and operate independently. 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. There would have been no partnership between our two companies if we had to compromise on the core principles that will always define our company, our vision and our product,” writes Koum.

Facebook’s real reason for buying WhatsApp? The younger crowd are leaving Facebook for instant messaging services like WhatsApp and Snapchat. Snapchat turned down a US$3-billion dollar offer from Facebook last year.

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