Facebook has agreed to acquire mobile photo-sharing application Instagram for $1 billion in cash and stock. The transaction, Facebook’s largest to date, is expected to close later this
quarter, the social networking site announced Monday.
Under the deal, Instagram will continue operate
as an independent business under the same name. Facebook CEO Mark Zuckerberg said in a post the acquisition would enhance the site’s ability to serve as photo-sharing hub.
“We need
to be mindful about keeping and building on Instagram’s strengths and features rather than just trying to integrate everything into Facebook,” wrote Zuckerberg. “That’s why
we’re committed to building and growing Instagram independently. Millions of people around the world love the Instagram app and the brand associated with it, and our goal is to help spread this
app and brand to even more people.”
Launched in October 2010, the Instragram app now has more than 30 million registered users. Last week, the company extended the service to Android
phones after building up a strong user base on the iPhone. Zuckerberg noted the deal marks the first time Facebook has acquired a product with so many users, and said it won’t be pursuing many
more on this scale.
The move comes as Facebook prepares for an initial public offering to raise up to $5 billion, which would make it the largest Internet offering to date. The IPO would value
Facebook at between an estimated $80 billion to $100 billion.