Facebook has bought messaging app WhatsApp in a deal worth a total of $19bn (£11.4bn) in cash and shares.It is the social networking giant's biggest acquisition to date.
WhatsApp has over 450 million monthly users and is popular with people looking to avoid text messaging charges.
In a statement announcing the deal, Facebook founder Mark Zuckerberg described WhatsApp's services as "incredibly valuable".
WhatsApp allows users to send messages over internet connections, avoiding text messaging fees. The company claims it is currently registering one million new users a day.
It makes money by charging users a subscription fee of $1 per year, although it offers a free model as well.
Silicon Valley's newest millionaires
The deal to buy it includes $4bn in cash and approximately $12 billion worth of Facebook shares, plus an additional $3 billion in stock to WhatsApp's founders and employees at a later date.
On a conference call to discuss the deal, WhatsApp co-founder Jan Koum says he plans to operate the firm "independently and autonomously". He will also become a member of Facebook's board of directors.
"We're excited and honoured to partner with Mark and Facebook as we continue to bring our product to more people around the world," Mr Koum said in a statement.
Mr Zuckerberg said the prospect of a deal was first floated just 11 days ago.
The Facebook founder said he believed WhatsApp was on track to have a billion users, but insisted he had no plans to place advertising on WhatsApp's interface, saying he did not think ads were the best way to make money from messaging systems.Once the deal is finalised, Mr Koum and co-founder Brian Acton are set to become Silicon Valley's newest billionaires.
WhatsApp has around 50 employees in total.
Siphoning billions Cathy Boyle, a senior analyst at research firm eMarketer, said WhatsApp was valuable to Facebook for several reasons beyond advertising, including its younger user base and its popularity overseas.
"WhatsApp actually has greater penetration in a lot of international markets than Facebook," Ms Boyle told the BBC.
She added that it was notable that Facebook's chief financial officer David Ebersman referred to the telecommunications industry when discussing the firm's purchase.
Facebook's previous biggest acquisition was Instagram, which it bought for $1bn in 2012
Facebook compra Whatsapp por 19.000 millones de dólaresIbamos a ir a dormirnos pronto pero el mundo tecnológico está revolucionado ante la noticia del día: Facebook acaba de comprar Whatsapp por 19.000 millones de dólares. Esta noticia sin duda es un bombazo ya que es una de las compras más importantes hechas por Facebook y una de las que más se hablará en el mundo de la tecnología.
La noticia se empezaba a rumorear hace unas horas pero ya está confirmada en el blog de Facebook y en el perfil de Mark Zuckerberg (creador de la red social). Una noticia que supone un importante movimiento para Facebook y para Whatsapp ya que últimamente había bastantes opiniones sobre los malos datos de ambas empresas.