Investing.com - Social media giant Facebook announced on Wednesday it has reached a definitive agreement to acquire mobile messaging company WhatsApp for $16 billion, including $4 billion in cash and approximately $12 billion in Facebook shares. The agreement also provides for an additional $3 billion in restricted stock units to be granted to WhatsApp's founders and employees that will vest over four years subsequent to closing.
Facebook said the deal reflects its shared mission with WhatsApp to bring more connectivity and utility to the world by delivering core Internet services efficiently and affordably.
The deal will also help accelerate growth and user engagement across both companies.
"WhatsApp is on a path to connect 1 billion people. The services that reach that milestone are all incredibly valuable," Mark Zuckerberg, Facebook founder and CEO said in a 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."
WhatsApp praised the deal as well.
"WhatsApp's extremely high user engagement and rapid growth are driven by the simple, powerful and instantaneous messaging capabilities we provide. We're excited and honored to partner with Mark and Facebook as we continue to bring our product to more people around the world," said Jan Koum, WhatsApp co-founder and CEO.
Over 450 million people use WhatsApp each month, with 70% of those people active on a given day.
Facebook said in a statement that WhatsApp adds more than 1 million new registered users per day.
In afterhours trading, Facebook shares were down 2.42% and trading at $66.41.
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