A picture is worth a thousand words, but a popular photo-sharing app is worth far more: Facebook announced it is purchasing Instagram for $1 billion.
To put the sale in perspective, the Wall Street Journal's Dennis K. Berman tweeted: "Remember this day. 551-day-old Instagram is worth $1 billion. 116-year-old New York Times Co.: $967 million."
The purchase of the San Francisco-based photo-sharing app is the largest financial acquisition in Facebook's history and is being made in cash. The deal will be completed by June, according to the AP.
"This is an important milestone for Facebook because it's the first time we've ever acquired a product and company with so many users," CEO Mark Zuckerberg wrote on his Facebook page. "We don't plan on doing many more of these, if any at all."
In a move to reassure Instagram's growing audience of users, Facebook announced that it will continue to let Instagram operate independently. However, Facebook is hiring Instagram's 10 employees.
"We think the fact that Instagram is connected to other services beyond Facebook is an important part of the experience," Zuckerberg wrote. "We plan on keeping features like the ability to post to other social networks, the ability to not share your Instagrams on Facebook if you want, and the ability to have followers and follow people separately from your friends on Facebook."
Wired reports the sale will yield huge earnings for Instagram's CEO Kevin Systrom, along with the company's co-founder and several investments firms that have provided financial backing for Instagram. Systrom reportedly owns 40 percent of the company, meaning he will take home $400 million from the sale. Co-founder Mike Krieger will earn about $100 million from his 10 percent ownership share.
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