Photo: Owen Thomas, Business Insider
“The transaction is fair, just, and equitable.”With those words, in a crowded hearing room on the sixth floor of a skyscraper in San Francisco’s Financial District, a commissioner for California’s Department of Corporations declared that Facebook could issue shares to buy Instagram.
The fairness hearing was the last regulatory hurdle the two companies had to face before the world’s largest social network could buy the hottest mobile photo-sharing startup. The companies opted to issue shares under California law rather than through the Securities and Exchange Commission, in part because it’s a faster process.
Amin Zoufonoun, Facebook’s director of corporate development, and Instagram CEO Kevin Systrom testified at the 90-minute hearing.
Instagram can now ask shareholders for consent, a process which may take another week.
Since Facebook is paying $300 million in cash and about 23 million in shares—currently worth $441 million—it’s widely expected Instagram’s shareholders will say yes.
So Instagram still has a few days of independence left.