This morning came the news of the largest acquisition of a consumer technology company ever. Facebook had acquired the maker of the messaging system WhatsApp for USD 19 billion, of which 16 billion was in cash and the rest in Facebook stock.
The number is huge and what's amazing about it is that one, practically hardly any one had heard of WhatsApp just about two years ago and two, this is actually a justifiable number because this is a profit making company with a clear revenue model which is growing at about 30 per cent PER MONTH.
How does this company, seemingly born just yesterday, compare with Indian corporates? To put the number in perspective, consider that WhatsApp's valuation (Rs 1,18,327 crore) is… ...lower than just thirteen Indian companies. WhatsApp is actually worth more than such stalwarts as State Bank of India, Tata Motors, HCL, L&T and Bajaj Auto. It's worth almost the same as ICICI Bank.
...more than one fourth of India's most valuable company, TCS.
...more than two-thirds of the total assets in all the equity funds in India, which are Rs 1.71 lakh crore
...more than the GDP of 82 countries. This includes such countries like Nepal, Brunei, Georgia, Jamaica and Cambodia.
...more than the TOTAL GDP of the 20 smallest countries.
And of course, while comparing it to Indian companies' market cap, do remember that the entire market cap is not realisable. However, some 84 per cent of WhatsApp's value is being paid up front by Facebook!
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