Facebook’s acquisition of photo-sharing app maker Instagram came another step closer on Wednesday when the US Federal Trade Commission (FTC) announced it had completed its antitrust investigation and would not be taking any further action.
Facebook said in a statement that it was “pleased” with the FTC’s decision though it gave no indication as to when the deal might be completed.
Back in April, a month before the social networking giant floated on the stock exchange, Facebook CEO Mark Zuckerberg said it intended to buy Instagram for $1 billion. The deal struck between the two companies meant Instagram would receive $300 million in cash and just under 23 million shares.
Of course, Instagram CEO Kevin Systrom had been hoping to see the value of Facebook shares hit the roof after the company went public in May. However, it’s gone the other way, with shares in the social networking company currently worth just half of their original $38 IPO price. This means the Facebook-Instagram deal is currently valued at just over $747 million.
The news in April of Facebook striking a deal with Instagram came as a surprise to many, not least the Facebook board. Co-founder Mark Zuckerberg reportedly sorted the deal all by himself, meeting Systrom at his Palo Alto home over three days, whittling the Instagram boss down to $1 billion from his original asking price of $2 billion. It’s thought Zuckerberg wanted to act fast in order to stop another company getting in first, with Facebook keen to find ways to increase its presence in the mobile space.
Instagram is a hugely popular free photo-sharing app that allows users to make fast and stylish edits to their snaps before sharing them on the Web. It currently has 80 million users, a figure impressive by any standards, but even more so when you consider it launched less than two years ago.