How Facebook bought Snap Inc. for $7.5B
Posted November 02, 2018 07:14:22Facebook Inc. is buying Snapchat Inc. in a $7 billion deal that is expected to close this week.
Snapchat’s stock closed down $1.14 to $28.50 in early trading Thursday, but the deal is expected by many analysts to provide Facebook with an additional revenue stream and an additional valuation of around $4 billion, Bloomberg reported.
It’s not clear if the acquisition will help Facebook generate more cash, but it will allow it to use Snapchat to further expand its reach in social media, a strategy that has seen the social media giant surpass Twitter Inc. as the most popular social network globally.
Facebook acquired Snap in 2016 for about $1 billion.
The deal is valued at $7,550 per share.
Snapchat is valued between $16.75 and $21.80.
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