THECOUNT.COM "News You Can Count On!" - May 10, 2012
The Federal Trade Commission may be investigating Facebook’s purchase of photo-sharing app Instagram says two different sources familiar with the probe.
In April, Facebook announced plans to buy the app for a whopping $1 billion in cash and stock. According to Facebook docs filed with the Security and Exchange Commission, the deal is set to close in the second financial quarter of 2012.
There may be a slight hiccup as The Financial Times is claiming two inside sources reported that the FTC had begun an antitrust investigation into the deal.
“The competition probe – routine for any deal more than $66m – is likely to take six to 12 months, according to several experts,” writes the FT.
As a part of a “fall-through” stipulation, Facebook must pay Instagram $200 million IF the deal does not come to fruition.
FTC Spokesman Mitch Katz said, “The FTC doesn’t have anything to say about this. We haven’t even said that we’re the agency responsible,” pointing out that the Department of Justice also has oversight over these matters. “The pre-merger review process is entirely non-public. Unless an early termination is granted.”
Facebook has not responded to requests to clarify their position on the matter.
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