The main research has the aim to understand if the price tag of $19 billion paid by Mark Zuckerberg was fair. (Though $1 billion was the headline price, the final acquisition closed at $715 million due to a decline in the value of Facebook’s stock.) It is the social networking giant's biggest acquisition to date. 0 i.e., the case of Facebook and its acquisition of Instagram and WhatsApp. The mission of this buy was to make the world more connected. h�Ԗ�O�0��K{�ٱ�DB�Z6�I�@0 �AT"�)j������G┴�>m����;��~?9�&d*���Ɍd$,S� H5YxI�uO���� In And it's probably an understatement. Jan Koum CEO of WhatsApp Mark Zuckerberg CEO of Facebook. ��mq��I�;�hЋZ�Jl���� ��F����&�[q"���$U$J��@\JeY�C,Sq�BCȰ�y������A��%��|����3̎y�6��՟Ri�l��͆���A�kHډ�>�1Ş6H����o������ � �(��hm:7@�e�N�x緽$��N�4~fzD���R���G.k[�)� Facebook. Advertising * What it means to Whatsapp founders Jan Koum and Brian Acton, the founders of Whatsapp, really don't like advertising. Supplement to case UV7211. %%EOF 1. ��^PQFj����™]6xa�:����m���6�� Acquiring WhatsApp According to a filing with the Securities and Exchange Commission : On February 19, 2014, Facebook had announced the landmark deal to buy WhatsApp for US$ 19 billion. Now, newly published confidential Facebook emails and charts show exactly why CEO Mark Zuckerberg spent a small fortune for the messaging app. 3. Now customize the name of a clipboard to store your clips. Facebook - WhatsApp Acquisition See our Privacy Policy and User Agreement for details. Facebook could also use WhatsApp to help bring more people online through subsidized Internet, which Facebook already offers in some countries. [)r+ԍ�&���,O��I�S:ēF~i��OWղ�|�p^����jY���R2���1ti'1�I��c�'v����Qϕjm�+5���O|p�y��1d��f�mZ���sL��y�!! The target is reaching 5.6 billion smartphone users by 2019 In the prepared statement for the acquisition, Facebook founder and CEO Mark Zuckerberg said: "WhatsApp … If you continue browsing the site, you agree to the use of cookies on this website. Explanation of acquisition of facebook and whatsapp.. Looks like you’ve clipped this slide to already. Clipping is a handy way to collect important slides you want to go back to later. Facebook. Facebook founder Mark Zuckerberg has released a statement explaining why his company has paid $19bn for mesaging service WhatsApp. You can change your ad preferences anytime. h�b```"f�A�13�0p0p�p�41*1$40e�2~Y���\�%ʇo��`�|pÂ� Firstly, Facebook offered unimaginable amount of $19 billion to buy WhatsApp. Facebook also purchased the defunct company ConnectU in a court settlement and acquired intellectual property formerly held by rival Friendster. Assuming billion isn't brain dead. n�� ����1�Ƽ �2\��S�~p?�V�Gk̰�b�H��� �"W-�b$ǻ�[��. "Facebook's WhatsApp acquisition now has price tag of $22 billion." (�`j_���P/���0���l���!�� �OD���W=F���q���w݉A�x\��/˓3�d**�!sK�m�jY�� �-{��.��{�۝�fĝ�=�����7�{���5��\W��}�jH��aӆ����za�T5U����8� ������lv�#�����u�ݨh�c#}}=ڋ�-���k)��m�[�� q�W�W����Kw` �T~� So when Facebook decided to buy Whatsapp everyone was interested to know the details. Was it the right decision for Facebook to acquire WhatsApp - and at the steep price of $19 billion? In February 2014, Facebook purchased the messaging service WhatsApp for $19 billion. Therefore, a Therefore, a descriptive-exploratory analysi s, market valuation multiples an d a comparative method h�bbd``b`��@�QH�T ��L�,� F2��o|0 �}� Many articles indicated that Facebook is turning old, with many users replacing it … (4) The Transaction consists of the acquisition of WhatsApp by Facebook for a purchase price of USD 19 billion.2 Pursuant to an Agreement and Plan of Merger and Reorganization signed on 19 February 2014, WhatsApp will successively merge with and into wholly-owned … Facebook has bought messaging app WhatsApp in a deal worth a total of $19bn (£11.4bn) in cash and shares. Slideshare uses cookies to improve functionality and performance, and to provide you with relevant advertising. Facebook, Inc. is a social networking company that has acquired 89 other companies, including WhatsApp. Slideshare uses cookies to improve functionality and performance, and to provide you with relevant advertising. 2. "Facebook to Acquire Instagram." Acquisition A corporate action in which a company buys most, if not all, of the target company's ownership stakes in order to assume control of the target firm. analysis showed that prior WhatsApp’s acquisition was performed, Facebook counted about 2.55 billion shares. Facebook has posted on its blog, detailing the reasoning behind the acquisition, as well. considering that Facebook’s $19 billion buying Whatsapp making it the company's largest acquisition. Facebook-Whatsapp Acquisition. �������w5`6�D��ԬS�oLf��ؽ��T�1T���5,J7U�6�].�h� t;�7 Customer Code: Creating a Company Customers Love, Be A Great Product Leader (Amplify, Oct 2019), No public clipboards found for this slide. The WhatsApp acquisition closed at a steep $16 billion; more than $40 per user of the platform. When Facebook notified the acquisition of WhatsApp in 2014, it informed the Commission that it would be unable to establish reliable automated matching between Facebook users' accounts and WhatsApp users' accounts. See our User Agreement and Privacy Policy. Accessed June 25, 2020. Along the reaction of Facebook’s EPS on the keydays after the purchase, a balanced assessment of the acquisition was obtained and discussed. Young Audience. Case study of Facebook and WhatsApp acquisition 1 Acquisition summary This year Feb. 19, the well-known social network Facebook (FB) announced its purchase of WhatsAppin stock and cash for 19 billion dollars, keeping it as a separate service. ������D��Et����(���AԦj�}�9?�+���`$���X��8C*H����M�wSuu'iC�(n�\d�O�����N���l�m�V��K���% ��P�ƪ�ls׼�=/�ӕ�q$[����a�n늏���s9G�J��Fc��r,��k����v ���e�Cl���0�N�:�;"��A�3�;rZ�%[|g}? Mohammed Saquib *�R�)�,b�8���Ō�^ 1 Press release (Comm.) Like other bold moves, an all-in cost of $200,000 per employee, Facebook’s andWhatsApp deal could end up looking that's a total cost base of $11 million. endstream endobj 1255 0 obj <>/Pages 1253 0 R/StructTreeRoot 191 0 R/Type/Catalog>> endobj 1256 0 obj <>/MediaBox[0 0 595.32 842.04]/Parent 1253 0 R/Resources<>/ProcSet[/PDF/Text]>>/Rotate 0/StructParents 0/Tabs/S/Type/Page>> endobj 1257 0 obj <>stream The acquisition … Facebook launched its mobile photo app in May 2012, weeks after it had announced that it would acquire Instagram. $19 billion is a big amount and if Facebook has decided to make an investment on WhatsApp then they would have considered all the possible factors. Facebook - WhatsApp Acquisition By Mohit Srivastava Mohammed Saquib Akash Mahamana. 2 S T A T I S T A , S h a r e o f F a c e b oo k … It stated this both in the notification form and in a reply to a request of information from the Commission. Koum holding bigger share in WhatsApp was to get about $6.8 … From a financial-statement-impact point of view, she wonders what the similarities and differences were between the Facebook/WhatsApp acquisition and the AT&T/DIRECTV deal. Mergers: Commission approves acquisition of WhatsApp by Facebook, 3 October 2014, IP/14/1088. endstream endobj startxref The Irrational Rationale behind Facebook’s Acquisition of WhatsApp: Defying all the theories of Corporate Finance and principles of equity valuation, Facebook recently announced acquisition of WhatsApp at a whopping valuation of $ 16 bn…yeah…you heard it … ��u�����"�vӓ��1���Ԥ��;�� The purpose of this work project is to analyze the acquisition of WhatsApp from Facebook occurred on 19 February 2014. Akash Mahamana. 1254 0 obj <> endobj endstream endobj 1 0 obj <>/MediaBox[0 0 595.32 842.04]/Parent 1253 0 R/Resources<>/ProcSet[/PDF/Text/ImageC]/XObject<>>>/Rotate 0/StructParents 1/Tabs/S/Type/Page>> endobj 2 0 obj <>stream This question was originally answered on Quora by Terrence Yang. Facebook’s app has similar functionality to Instagram’s. particularly mobile advertising, in Facebook’s business model and how this model necessitates user growth and user surveillance. �A. – February 19, 2014 – Facebook today announced that it has reached a definitive agreement to acquire WhatsApp, a rapidly growing cross-platform mobile messaging company, for a total of approximately $16 billion, including $4 billion in cash and … Facebook buys WhatsApp: Mark Zuckerberg explains why. We use your LinkedIn profile and activity data to personalize ads and to show you more relevant ads. The acquisition price was staggering for an app that made little money and was largely popular outside the United States. MENLO PARK, Calif., Feb. 19, 2014 /PRNewswire/ --€Facebook today announced that it has reached a definitive agreement to acquire WhatsApp, a rapidly growing cross-platform mobile messaging company, for a total of approximately $16 billion, including $4 billion in cash and approximately $12 billion worth of Facebook shares.€ The agreement also provides for an All this led to $173.5 bilion of market capitalization for Facebook. 1. The post notes that WhatsApp will continue to operate independently and retain its brand. By Whatsapp a company having only 55 employees is the costliest buy ever in the software industry. What challenges does Facebook's proposed acquisition of WhatsApp face? The majority of the companies acquired by … endstream endobj 1258 0 obj <>stream Accessed June 25, 2020. Afterwards, the firm roughly issued other 230 million shares (market price of $15.8 billion) to acquire WhatsApp. Mohit Srivastava v{�7��������n�PƳbS����i����i��4'��:���B+^���H���φ�w�~.� Facebook, who was advised by Allen & Co, will pay $4 billion in cash, $12 billion in Facebook shares and $3 billion in restricted stock units to be granted to WhatsApp founders and employees that will 5. 1259 0 obj <>/Filter/FlateDecode/ID[<948AA3AA24ED6646867AAF35006D6E8B><5AC15715AECBB44DAF6821A65BA406C3>]/Index[1254 19]/Length 49/Prev 432725/Root 1255 0 R/Size 1273/Type/XRef/W[1 2 1]>>stream It allows users to apply filters, tag photos, comment on photos, and post the photos to Facebook. ��92l�VloZ^R{(|ar������6�毌��4�0[��&�Ԟ%���#����*]*��4U&*��I�-if��s㬙q�2�d3�d�/�f��e�9z3��!����F � � Bb` �C��bf�:bX-.i`�1��5��8�@��� ,d@��lI�@����)���y@� ��hJ 1272 0 obj <>stream Using as a case study Facebook’s acquisition of the instant messaging (IM) company WhatsApp, I investigate how the IM market has changed Facebook’s merger and acquisitions strategy, while continuing its 16. �gP=�\B�V�DRa��R-��8�w�����9T�i_�B�8a��”��Խ�2J��$����V�� 9v�ğzF����[%Ok�4� �-4���$>� إNt�����jx}&��Fv{��p`���hƥ?V�k4�֨�QN� �4 H��WYo�H~ׯh䉜�h��+���q�� The billion dollar Acquisition On February 19, 2014, Facebook Inc. announced it is acquiring WhatsApp Inc. for US$19 billion. Most of the industry analysts state that this decision cannot be considered to be appropriate but it is not true. MENLO PARK, Calif., Feb. 19, 2014 /PRNewswire/ -- Facebook today announced that it has reached a definitive agreement to acquire WhatsApp, a rapidly growing cross-platform mobile messaging company, for a total of approximately $16 billion, including $4 billion in cash and approximately $12 billion worth of Facebook shares. Facebook Acquisition of Whatsapp: Pros and Cons In the present world if you ask the one thing which most of the youngsters are addicted to, then the answer will be Whatsapp. However, faced with the evolving mobile communication industry and increasing competition, the company was on the lookout to increase its user base by acquiring WhatsApp. WhatsApp But Facebook buying WhatsApp for $19 currently has only 55 employees. It includes: -USD 4 billion in cash -USD 12 billion worth of Facebook shares -USD 3 billion in restricted stock units Facebook CEO Mark Zuckerberg announced that WhatsApp will continue to operate independently. networks. %PDF-1.6 %���� After due consideration, Facebook decided to buy WhatsApp. Reuters. Finally Facebook … If you continue browsing the site, you agree to the use of cookies on this website. In the B case, Susan Shaw has finished her review of the Facebook/WhatsApp deal and recalls hearing about AT&T's acquisition of DIRECTV in July 2015. H��V�n�F}�W��nR���|aR���2�>Xy�e�V Q�L5���̒�iYV�@�����3�;8Zճi1�����Q]���n�˺^.�� ����x�UE=[V����� 9ǹ3�s���|�ĩg"C*H�� �a E�x�a!�\z&����NJ�F�ҭ��FL�3�1)i*S��n V4\�X�aw���Md"�K3|K|�>�I��)�2�K�k�T���|q#U�̟�j�}����G��4��c��,�b���^_��;�B*S��X�僵�$Ǧ�˖O�s����^���Q�H���"�:, �)M/.c"τ����ܹv�r���!�|qrv ��� (�r&�H��*_�g);>���}Y7,ͧ��7�C�Ȕ��x�ZV�dž��ϥs;��题oX"��nf����Q�����"���y�,�t];�q* ��)����/J��,�zΒ�/^\�-�/�ry���?O�]�2YWO�j������V���@әb4����|�NG����f)��ԍ���1�Cƺ� Facebook to Acquire WhatsApp ‐ Acquisition accelerates Facebook's ability to bring connectivity and utility to the world ‐ Leading mobile messaging company will continue to operate independently and retain its brand ‐ WhatsApp co‐founder and CEO Jan Koum to join Facebook Board of Directors MENLO PARK, Calif., Feb. 19, 2014 /PRNewswire/ ‐‐ Facebook today announced that it has reached a definitive agreement to acquire WhatsApp… Established in 2004, Facebook had shown stupendous growth. 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