The final price tag of WhatsApp acquisition by Facebook has emerged, following the closure of Facebook Inc [FB.O] for same purpose on Monday.
This is mainly because Facebook’s stock saw increment in its valuation over the last few months, raising the price tag of WhatsApp by $3 billion to end at about $22 billion.
Facebook’s acquisition of WhatsApp was announced in February, but was recently approved by the European regulatory authority. The mobile messaging app has more 600 million monthly users, with a large percentage of such numbers found in India. It is reported that 65 million WhatsApp users are located in India, explaining why tech giants like Google sees the emerging markets as a testing ground.
Google plans to launch it mobile messaging app, which would be similar to WhatsApp but would be entirely free, not requiring Google login credentials to gain access. The company is looking at India, to be the first market where it would test the service.
Now, Jan Koum, founder of WhatsApp will receive $2 billion in Facebook’s stock with legal vesting over a four-year period, as an incentive for him to stick with the company, based on a regulatory filing on Monday. Koum will serve as a Chief Executive of WhatsApp and will become a director in Facebook and will earn a $1 annual salary, bringing in on par with what Facebook’s co-founder and CEO Mark Zuckerberg earns. Koum will also receive 24.9 million Facebook restricted stock units, worth about $1.9 biliion.
Meanwhile, Facebook paid $4.59 billion in cash and 178 million shares of its stock for WhatsApp, as well 46 million of grants in restricted stock units for WhatsApp employees that will vest over a four year period.