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Facebook Purchases WhatsApp For $19 Billion

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Facebook has reached an agreement to acquire WhatsApp, a cross-platform mobile messaging company that allows users to send messages to friends and family via mobile broadband.

The transaction will cost Facebook $19 billion: $4 billion paid in cash and $12 billion paid in Facebook shares. An additional $3 billion will be paid in restricted stock units to WhatsApp founders and employees over a four-year period once the acquisition is completed.

The real-time mobile messaging app — which currently has more than 300 million daily active users — will continue to operate independently as a stand-alone service, and will maintain its own brand image. In addition, Jan Koum, WhatsApp co-founder and CEO will be joining Facebook’s Board of Directors.

“WhatsApp is on a path to connect one billion people,” noted Mark Zuckerberg, Founder and CEO of Facebook. “The services that reach that milestone are all incredibly valuable. I’m excited to partner with [WhatsApp CEO Jan Koum] and his team to make the world more open and connected.”

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This acquisition news has emerged following Zuckerberg’s attempt to acquire Snapchat for approximately $3 billion. Snapchat is a mobile messaging app that allows users to send photos that disappear once they’re opened for 10 seconds. Some reports point to the WhatsApp acquisition as a way for Facebook to improve its breadth of messaging services.

The filing indicated that Facebook has agreed to pay a breakup fee of $1 billion to WhatsApp should the deal fall through.

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