FTC probe may delay close of Facebook-Instagram deal
Facebook buys Instagram
On April 9, Facebook CEO Mark Zuckerberg announced that the social network planned to acquire Instagram, the popular photo-sharing mobile app. It was later reported the deal was for a whopping $1 billion.
Facebook's purchase of Instagram was finalized in September for $715.3 million -- $300 million of it in cash and the rest in stock.
(CNET) The government's probe into Facebook's $1 billion purchase of photo-sharing app Instagram threatens to delay the close of the deal, according to a report in the Financial Times. That could prove distracting while the social-network company is deep into its initial public offering (IPO) roadshow.
Citing two people familiar with the matter, the FT says the Federal Trade Commission has begun collecting information from two of Facebook's largest competitors - presumably Twitter and Google, although the newspaper doesn't say.
Such a probe is routine for any deal of this size, but the FT says this investigation could take six to 12 months.
Facebook's S-1 IPO documents say that the company expects to the to close this quarter. It's unclear what such a delay would mean - both for Facebook's still nascent mobile strategy and potentially for the IPO itself.
Paul Sloan has been a San Francisco-based correspondent for Fortune magazine, an editor-at-large for Business 2.0 magazine, and a senior producer for CNN. He's now an executive editor at CNET News. When his fingers aren't on a keyboard, they're usually on a guitar. Email him here.