Facebook’s strategy is defensive acquisition to prevent a larger company being created, just like with the Instagram acquisition two years ago. Nevermind that WhatsApp’s business model isn’t really proven, bested in the short term by gaming platforms such as Kakao and Line with much much smaller number of users. The company is worth $345 million per employee to Facebook, or more than $500 million per engineer.
Given that the acquisition is primarily stock based ($12 billion out of $16 billion, **only** $4 billion in cash), we may see a different final purchase value once the deal closes. Instagram’s final acquisition value was in the mid $700 million as Facebook stock lost value in the months between announcement and close of deal. – Read on Path.
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