In a new round of the tech industry’s most recent round of financing, the New York Stock Exchange (NYSE) and its New York subsidiary, NYSE Arca, are joining forces to fund the acquisition of WhatsApp, the messaging app company.
The transaction is expected to close in the second quarter of 2018, according to sources familiar with the deal.
For the first time in the past decade, a single company has acquired the majority of a messaging app and internet company.
The deal, if approved by regulators, will give the New Yorker a foothold in a nascent sector of the global messaging market, with potential to drive even larger growth in the months ahead.
“The New York exchange has long been a leader in the marketplace of digital commerce and is committed to serving our customers,” said NYSE Chairman and CEO Robert E. Schiller.
“WhatsApp’s success is driven by a diverse group of customers, including small businesses, government agencies, and government employees.
We are excited about the opportunity to join forces and build a stronger digital economy.”
With a total market cap of $21 billion, WhatsApp is one of the most valuable and widely used messaging apps on the planet.
It also provides one of WhatsApp’s biggest revenue streams, with over 100 million monthly active users.
Its mobile and desktop apps have been downloaded by millions of people around the world.
The company’s $13 billion valuation puts it one of Facebook’s largest private companies, with an annual revenue of $100 billion.
The deal has drawn interest from a number of big tech companies, including Microsoft, Google, Facebook, Amazon, and Twitter.
Wall Street firms are betting that WhatsApp will become a strong competitor to Facebook, which is struggling to recover from the public shaming of former CEO Mark Zuckerberg and the social media company has been struggling to keep up with the rising demand for the platform.
“Whatson will provide the company with a robust business model, and it will help us continue to build out its existing businesses and provide a broader range of services to our customers as we continue to grow,” Facebook’s general counsel Alex Stamos wrote in a blog post.
Whatsapp has seen its valuation rise dramatically over the past year, from around $5 billion to more than $30 billion.