Hot of the presses from the New York Times, the numbers that we have all been waiting for: According to the paper, the terms of the Instagram/Facebook deal were as follows:
- 30% cash
- 70% stock
- Stock valued at ‘north’ of $75 billion
- That puts Facebook’s stock at around $30 a share
Here’s the kicker: The private market last valued Facebook at $104 billion, meaning that the stock that Instagram now holds could be worth about 1/3rd more than what Facebook valued it at, essentially implying that Instagram could make out big in the IPO.
Put another way, Facebook might have effectively paid more than $1,000,000,000 for Instagram. There’s only one remaining question: did Facebook issue more stock to cover the massive purchase? When the company files an amended S-1, we’ll know, but for now, it seems all but certain that Facebook put down $300,000,000 in hard currency for the photo-sharing firm.
That’s big money.
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