NEW YORK (TheStreet) - Facebook (FB) has clinched a $16 billion deal to acquire mobile messaging company WhatsApp.
The purchase price comprises $4 billion in cash and approximately $12 billion worth of Facebook shares, according to a statement released by Facebook. The deal also includes an additional $3 billion in restricted stock units to be granted to WhatsApp's founders and employees.
WhatsApp will continue to operate independently and retain its brand following the acquisition's closure and the company's co-founder and CEO Jan Koum will join the social network's board.
While eyebrows will be raised at the $16 billion price tag for WhatsApp, Facebook clearly sees great value in the Mountain View, Calif.-based firm. Over 450 million people use the mobile messaging service each month and WhatsApp adds more than a million registered users each day. "WhatsApp is on a path to connect 1 billion people. The services that reach that milestone are all incredibly valuable," said Facebook CEO Mark Zuckerberg, in the company's statement. "I've known Jan for a long time and I'm excited to partner with him and his team to make the world more open and connected." Facebook shares tumbled 4.64% to $64.90 in extended trading on Wednesday. --Written by James Rogers in New York. Follow @jamesjrogers >Contact by Email.
Stock quotes in this article: FB
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