Facebook Inc will buy fast-growing mobile-messaging startup WhatsApp for $19 billion in cash and stock in a landmark deal that places the world's largest social network closer to the heart of mobile communications and may bring younger users into the fold.
The transaction involves $4 billion in cash, $12 billion in stock and $3 billion in restricted stock that vests over several years. The WhatsApp
deal is worth more than Facebook raised in its own IPO and underscores
the social network's determination to win the market for messaging.
Founded by a Ukrainian immigrant who dropped out of college, Jan Koum, and a Stanford alumnus, Brian Acton, WhatsApp is a Silicon Valley startup fairy tale, rocketing to 450 million users in five years and adding another million daily.
"No
one in the history of the world has ever done something like this,"
Facebook Chief Executive Mark Zuckerberg said on a conference call on
Wednesday.
Zuckerberg, who famously closed a $1 billion deal to
buy photo-sharing service Instagram over a weekend in mid-2012, revealed
on Wednesday that he proposed the tie-up over dinner with CEO Koum just
10 days earlier, on the night of Feb. 9.
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