Explanation of acquisition of facebook and whatsapp..

1. Facebook - WhatsApp Acquisition
By
Mohit Srivastava
Mohammed Saquib
Akash Mahamana

2. Jan Koum
CEO of WhatsApp
Mark Zuckerberg
CEO of Facebook

3. 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. Acquisitions are often made as part of a company's growth
strategy whereby it is more beneficial to take over an existing firm's
operations and niche compared to expanding on its own. Acquisitions
are often paid in cash, the acquiring company's stock or a combination
of both.
Facebook recent acquisitions
• Instagram in 2012 worth $1 billion
• SnapTu in 2011 worth $70 million

4. WhatsApp
Founded Feb 24 2009
Founder Jan Koum
Stable Release iOS – Version 2.11.7
Windows – 2.11.356.0
Blackberry – 2.11.529
Android – 2.11.152
Operating System iOS, Android, Blackberry, Nokia
Series 40, Symbian, Windows,
Nokia Asha
License Proprietary

7. Facebook
Founded Feb 4 2004
Founder Mark Zuckerberg, Eduardo
Saverin, Andrew McCollum,
Dustin Moskovitz, Chris Hughes
Revenue US$7.872 billion
Operating income US$2.804 billion
Net income US$1.5 billion
Users 1.23 billion (monthly active)

10. Value of the Deal
• WhatsApp is being Acquired for $19 billion
• It includes
- USD 4 billion in cash
- USD 12 billion worth of Facebook shares
- USD 3 billion in restricted stock units
• Jan Koum to join board of directors of facebook

11. Why Acquisition
• MAU (monthly active users) will ramp up to 1 billion by 2019
• Gives it additional leverage over Twitter in the battle for more
direct messaging market share.
• WhatsApp’s function will make it a near-essential add-on to
smartphones, and this—combined with smartphone user growth
as well as user behaviour that’s shifting more and more towards
mobie.
• This will help Facebook to diversify its revenue sources away from
the U.S.

12. SWOT Analysis
Strengths
• Loyal customers
• Market share leadership
• Group Chat
• Avaialable for all platforms
• Diversify
• Free voice calls
Weakness
• Not diversified, because other applications offers the same
service and also function as social media
• To access the account can only be paid by credit card only
• Only works with a data plan or wifi

13. Oppurtunities
• Continued development of technology platforms
• Advanced technology
• Recognized application
• Modernization of people
• Increased demand for smartphones
Threats
• Competitors like Wechat, Viber, Tango, Skype, Line
• Product substitution
• Similar applications and free

14. • WhatsApp to add voice call to its product in second half of this year.
• Two privacy groups filed a complaint with the Federal Trade Commission to
block Facebook's $19 billion acquisition of messaging service WhatsApp.
The groups want Facebook to provide more insight into how it intends to use
data from the app's 450 million users.
Present Status

15.  http://www.insidefacebook.com/2014/02/25/what-others-are-saying-about-
facebooks-acquisition-of-whatsapp/
 http://www.huffingtonpost.com/quora/why-did-facebook-
acquire_b_4875055.html
 http://finance.yahoo.com/news/must-know-facebook-acquires-whatsapp-
162740629.html
 http://www.informationweek.com/software/social/facebooks -whatsapp-deal-
under-fire/d/d-id/1114183
 http://www.forbes.com/sites/adamhartung/2014/02/24/zuckerbergs -3-smart-
leadership-lessons-from-facebook-buying-whatsapp/
 http://edition.cnn.com/2014/02/21/opinion/wolf-facebook-whatsapp/
 http://indianexpress.com/article/business/world-market/facebook-to-acquire-
whatsapp-for-usd-19-billion-in-cash-and-stock-deal/
 http://sequoiacapital.tumblr.com/post/77211282835/four-numbers-that-
explain-why-facebook-acquired
 http://marketrealist.com/2014/02/facebook-acquires-whatsapp-19-billion/
 http://timesofindia.indiatimes.com/tech/tech-news/software-
services/WhatsApps-first-new-feature-under-Facebook-Voice-
calls/articleshow/30951210.cms
Reference

16. THANK YOU