Facebook To Acquire WhatsApp For $19 Billion in Cash and Stock

News broke this evening via a regulatory filing that Facebook is acquiring mobile messenger WhatsApp for $19 Billion in cash and company stock. Specifically, WhatsApp will be acquired for $4 billion in cash, approximately $12 billion worth of Facebook shares, and $3 billion in restricted stock units to be granted to WhatsApp’s founders.

Facebook has detailed the reasoning behind this acquisition on their blog. Avid users of WhatsApp may be pleased to find out it will continue to operate independently and retain its brand, similar to what Instagram has done following their acquisition by Facebook except WhatsApp founders are firmly against incorporating advertising into the platform.

In a post on the WhatsApp blog, founder Jan Koum states:

… 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.

Here are some important points about WhatsApp that make it so valuable:

  • 450 million monthly active users;
  • 70% of total users are active every day;
  • Messaging volume is almost as much as the entire global telecom SMS volume; and
  • Continued strong growth, currently adding more than 1 million new registered users per day.

According to Mark Zuckerberg, WhatsApp will soon be connecting one billion people worldwide: “WhatsApp is on a path to connect 1 billion people. The services that reach that milestone are all incredibly valuable.”

The success story of WhatsApp is even more incredible after knowing they only employ around 50 people total, 32 of which are engineers. That means roughly 1 engineer to every 14 million users, which is a lot of responsibility considering WhatsApp processes 50 billion messages a day across 7 platforms.

Facebook hosted a  30-minute conference call today to discuss the acquisition a replay will be made available on the Facebook Investor Relations website at investor.fb.com.