Facebook purchase of Instagram cleared by FTC
updated 06:51 pm EDT, Wed August 22, 2012
Move follows release of deal by UK Office of Fair Trading
In a 5-0 vote, The Federal Trade Commission has voted to close the investigation of Facebook's acquisition of Instagram. The FTC has chosen to do nothing to block or otherwise hinder the merger, but reserves the right to "take such further action as the public interest may require." Mark Zuckerberg claims that Instagram will still share content out to non-Facebook sites, and it would still be possible to add and share with friends who aren't connected even after the merger.
"We're committed to building and growing Instagram independently," Zuckerberg said. "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."
Zuckerberg added that the buyout was a very rare deal for the sheer size of the user base, with over 30 million users even before Instagram's Android version appeared. He even suggested this may be one of the last of its kind for Facebook. "We don't plan on doing many more of these, if any at all," he said.
Earlier this month, the UK-based Office of Fair Trading (OTC) , a rough equivalent of the US FTC, allowed the deal to continue. The OTC "does not believe that it is or may be the case that the merger may be expected to result in a substantial lessening of competition within a market or markets in the United Kingdom."
The deal is slated to cost Facebook $300 million in cash, and 23 million shares in Facebook stock. When the deal was announced, the cash value of the transaction was $1 billion. At today's close of $19.44 per share, the deal is now worth $747.1 million dollars, a more than 25 percent drop in value.
