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Tag: Facebook (1-7 of 7)

Facebook buying messaging app WhatsApp for $16B

Facebook is buying mobile messaging service WhatsApp for up to $19 billion in cash and stock, by far the company’s largest acquisition.

The world’s biggest social networking company said Thursday it’s paying $12 billion in Facebook stock and $4 billion in cash for WhatsApp. In addition, the app’s founders and employees will be granted $3 billion in restricted stock that will vest over four years after the deal closes.

Facebook says it is keeping WhatsApp as a separate service, just as it did with Instagram, which it bought for about $715.3 million.

WhatsApp has more than 450 million monthly active users. In comparison, Twitter had 241 million users at the end of 2014.

Facebook CEO Mark Zuckerberg says WhatsApp is on path to reach a billion users.

Facebook announces Graph Search

Facebook CEO Mark Zuckerberg announced the social network’s beta tool — Graph Search — is available today in limited release. It’s a bigger search bar, within Facebook, that allows members to type in natural language queries and access people, photos, places, and interests embedded within 1 trillion connections. For example, users could search who among their friends have recently bought shoes or eaten dinner in a certain city — the theory being that Graph Search could disrupt the business models of platforms like Yelp, Foursquare, or Google Local.

For now, Graph Search isn’t capable of tracking Facebook posts or Open Graph actions like song listens, which means that the few hundred thousand people who have it will be able to only partially use it. Already, analysts and experts are questioning why Facebook is treating this announcement like a big deal. Predicting that Graph Search could become a major threat to Google and Amazon, for example, seems premature. More skepticism over at CNET.

Graph Search is in limited beta for now; you can sign up to get on the list here.

Facebook lawsuits add to IPO troubles

Facebook’s initial public offering is the subject of two congressional inquiries and mounting lawsuits as the social network enters its fifth day of public trading. The shares regained some ground Wednesday, rising $1, or 3.2 percent, to close at $32. They were up another 50 cents, or 1.6 percent, to $32.50 in early premarket trading Thursday. But they are still more than 14 percent below their $38 per share IPO price last week.

The stock’s rocky inaugural trading day last Friday was followed by a two-day decline. The launch was held up by a half-hour delay, caused by glitches on the Nasdaq Stock Market. It was marred further this week as investors began accusing the banks that arranged the IPO of sharing important information about Facebook’s business prospects with some clients and not others.

Several shareholders who bought stock in the IPO have filed lawsuits against Facebook, its executives and Morgan Stanley, the IPO’s lead underwriter. At question is whether analysts at the big underwriter investment banks cut their second-quarter and full-year forecasts for Facebook just before the IPO, and told only a handful of clients about it.

One lawsuit, filed in U.S. District Court in New York, claims Facebook’s IPO documents contained untrue statements and omitted important facts, such as a “severe reduction in revenue growth” that Facebook was experiencing at the time of the offering. The suit’s three plaintiffs, who bought Facebook stock on its first day of trading May 18, claim they were damaged in the process.

Morgan Stanley declined to comment. Facebook said the lawsuit is without merit.

Another lawsuit, filed in San Mateo County Superior Court in California, claims Facebook and underwriters misled investors in Facebook’s IPO documents. Both lawsuits seek class action status on behalf of investors who bought Facebook stock and lost money on Friday. “No one gets it perfect, as far as saying what the financial results are,” said Anthony Michael Sabino, professor at St. John’s University’s Peter J. Tobin College of Business. The bottom line, he added, is whether Facebook or the underwriter had material information about Facebook’s finances that was not disclosed publicly. “At this moment, it’s still too early to say,” Sabino said. “We don’t know enough, but this could turn out to be an issue.”

What is known is that, in March, Facebook began meeting with analysts at the underwriting firms. The gatherings are a customary part of the IPO process and are designed to help analysts understand the company’s business so they can make accurate financial projections. On May 9, the third day of Facebook’s pre-IPO roadshow to meet with prospective investors, the company filed an amended IPO document that said its number of mobile users was growing faster than its revenue. According to a person familiar with the matter, Facebook then had another meeting with analysts and told them that based on the new information in the filings, the analysts’ forecasts should be at the low end of the range that the company gave them in April. The person spoke on the condition of anonymity because they were not publicly authorized to discuss the matter.

Adding to Wednesday’s events, Facebook was in talks with the New York Stock Exchange to move its stock from the Nasdaq Stock Market after the botched offering, according to a person familiar with the matter. The person spoke on the condition of anonymity because they were not authorized to speak publicly. The news of the talks was first reported by Reuters.

NYSE spokesman Rich Adamonis said: “There have been no discussions with Facebook regarding switching their listing in light of the events of the last week, nor do we think a discussion along those lines would be appropriate at this time.”

A Nasdaq spokesman declined to comment.

Sen. Tim Johnson, D-S.D., chairman of the Senate Banking Committee, said late Wednesday that his panel wants to learn more about the social network’s initial offering. The committee seeks briefings with Facebook representatives, regulatory agencies and others. After the briefings, Johnson said, he will determine whether a hearing should be held.

Also gathering information about Facebook’s IPO is the House Financial Services Committee. An aide to that panel said its staff is getting briefings. The subject is likely to be raised in hearings by the committee in the coming weeks, even though no hearings are planned specifically on the Facebook IPO, the aide said. The aide spoke on condition of anonymity because the House committee’s planned inquiry hasn’t been publicly announced.

Facebook CEO Mark Zuckerberg marries

As if his company’s IPO wasn’t enough big news for one week, Facebook founder and CEO Mark Zuckerberg got married on Saturday as well. Zuckerberg, 28, and his longtime girlfriend, Priscilla Chan, 27, told friends they would be attending a party in Palo Alto, Calif., to celebrate Chan’s recent graduation from medical school, but surprised attendees by telling them that the pair would be marrying instead. Zuckerberg posted the news on his Facebook timeline; the post has over 750,000 likes and counting.

Facebook IPO raises $16 billion

Facebook’s initial public offering of stock is shaping up to be one of the largest ever. The world’s definitive online social network is raising at least $16 billion for the company and its early investors in a transaction that values Facebook at $104 billion.

It’s a big windfall for a company that began eight years ago with no way to make money.

Facebook priced its IPO at $38 per share on May 17, at the high end of expectations. The IPO values Facebook higher than and other well-known companies such as Kraft, Disney and McDonald’s.

Facebook’s stock is expected to begin trading on the Nasdaq Stock Market sometime May 18 under the ticker symbol “FB.” That’s when so-called retail investors can try to buy the stock.

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Report: Facebook IPO set for May 18

The proof is in the pudding and on May 18, the world will learn what social networking is really worth. Facebook, which has a valuation of $100 billion, has set its IPO date for May 18, according to The Wall Street Journal. The company expects to raise over $10 billion.

Early investors like Bono’s Elevation Partners and other bold-faced names will be in the black, and still more in the inner circle will be able to invest outright. But what does Facebook’s going public mean for users? For a basic outline and understanding of just how big Facebook is and what the IPO could mean on a larger scale, check out this video from Kapitall, first picked up by Mashable, below:  READ FULL STORY

Facebook acquires Instagram for $1 billion

Facebook is acquiring popular photo-sharing app Instagram for approximately $1 billion in a combination of cash and shares, the social network announced today. The sale is expected to close later this quarter.

CEO Mark Zuckerberg released a statement on the deal on his Facebook page:

“For years, we’ve focused on building the best experience for sharing photos with your friends and family. Now, we’ll be able to work even more closely with the Instagram team to also offer the best experiences for sharing beautiful mobile photos with people based on your interests.”

Zuckerberg also made it clear that Facebook plans to play to the photo app’s strengths, saying that Facebook is “committed to building and growing Instagram independently rather than just trying to integrate everything into Facebook.”

The popular app allows users to alter photos taken on their cell phones with special effects, and then share them. Kevin Systrom, the CEO of the company, also issued a statement on Instagram’s site reaffirming that the app will maintain its identity. “The Instagram app will still be the same one you know and love,” he said. “We’ll be working with Facebook to evolve Instagram and build the network. We’ll continue to add new features to the product and find new ways to create a better mobile photos experience.”

Read more:
Mark Zuckerberg’s big Facebook announcement: What you need to know from his keynote speech
Mark Zuckerberg named TIME’s Person of the Year

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