Facebook is extending the deadline of WhatsApp’s closure to August 19, 2015 according to its Form 10-Q filed with the Securities and Exchange Commission (SEC) last week.
The short timeline of the acquisition includes Facebook announcing its plans to acquire the instant messaging platform back in February, with plans were laid out to pay a total of $19 billion in stocks and cash. A few months later in April, the Federal Trade Commission approved of the deal and Facebook added WhatsApp’s founder to its board of directors and announced plans to close the program on August 19.
The European Commission and Asian regulatory commission can be slow in giving the thumbs up to an acquisition in the markets they oversee. As of late there’s been a good reason for this given that consumer privacy and safety are major concerns for the European Commission. Having brought the intention of the deal to the European Commission in May, Facebook are waiting while it investigates everything.
As detailed in the terms of the Form 10-Q, if Facebook’s bid to pick up WhatsApp isn’t finalized by August 19, 2015, the social media giant will have to pay $1 billion as a termination fee. The company will also pay and an additional $1 billion in class-A common stock.
Due to its familiarity with dealing with the European Commission on antitrust matters, Facebook probably feels that a year extension is more than enough time to wrap things up when it comes to appeasing the regulatory body.