Facebook Completes WhatsApp Acquisition; Closing Bid At $22 Billion
Facebook has crossed all hurdles in an official take-over of WhatsApp with a closing bid of $22 billion.
Facebook, the world's largest social networking service, is the legal owner of popular cross-platform instant messaging app, WhatsApp. The company completed the acquisition on Monday with its final price tag going up by an additional $3 billion to approximately $22 billion. The increased price does not mean any changes to the original agreement between Facebook and WhatsApp, which was valued at $19 billion, but the increased value of Facebook's stocks was the reason behind the spike.
The acquisition of WhatsApp follows a public announcement by Facebook in February. The regulatory hurdles kept the social network from closing the bid early. Just last week, the company received its final approval from the European Union, much needed for the closure of the multi-billion-dollar deal.
In the SEC filing for the acquisition, Facebook detailed the purchase was completed using 177,760,669 shares of Facebook's Class A common stock, 45,941,775 in restricted stock to WhatsApp employees and $4.59 billion to WhatsApp stakeholders. Re/Code calculated the total bid for the acquisition and concluded that Facebook paid $21.8 billion in stock and cash for WhatsApp.
The documents also revealed that one of WhatsApp's founders, Jan Koum, joined the Facebook Board. As a signing bonus, Facebook paid Koum $2 billion worth 24,853,468 restricted stock units, HNGN reports via WSJ. Like Facebook CEO Mark Zuckerberg, Koum will draw a base annual salary of $1, and join other renowned personalities like Steve Jobs, Larry Page, Sergey Brin and others.
Koum will continue to serve as WhatsApp's Chief Executive and also take up the role of Facebook director. Besides him, more than seventy WhatsApp employees will be based in the company's original Mountain View, Calif. head office location.
WhatsApp is a crucial acquisition for Facebook, as it is tapping into the ever-increasing communication arena. WhatsApp has more than 600 million monthly users, which adds to the company's growing list of messaging and social media apps that have grown popular over the months. Facebook's plans for WhatsApp remain unclear but the team behind the chat application has convinced its users that there will be no changes to the app.
