Facebook is back in the headlines with another multibillion-dollar acquisition just a couple of weeks after acquiring messaging provider WhatsApp for $16 billion. Today, Facebook announced they are acquiring Oculus VR for $2 billion, including $400 million in cash and 23.1 million shares of stock valued at a total of $1.6 billion, Facebook announced today.
According to a press release from Facebook, the company plans to expand the Oculus Rift headset’s applications beyond gaming to broader fields such as media, entertainment, communications and education. At the same time, Facebook wants to speed up the company’s growth in the gaming space. The deal is expected to close during the second quarter of 2014.
“Mobile is the platform of today, and now we’re also getting ready for the platforms of tomorrow,” said Mark Zuckerberg, founder and CEO of Facebook, in the press release. “Oculus has the chance to create the most social platform ever, and change the way we work, play and communicate.”
“We believe virtual reality will be heavily defined by social experiences that connect people in magical, new ways. It is a transformative and disruptive technology, that enables the world to experience the impossible, and it’s only just the beginning,” said Brendan Iribe, co-founder and CEO of Oculus.
The agreement provides for an additional $300 million payout in cash and stock if Oculus achieves certain milestones. Oculus will stay at its existing Irvine, Calif., headquarters; chief technical officer John Carmack heads up the company’s Dallas branch, and a third office is set to open in San Francisco soon.
Oculus was founded by Palmer Luckey in July 2012 and was initially launched as a Kickstarter campaign for the Oculus Rift that summer, raising more than $2.4 million. Oculus later secured angel and venture capital investments of $16 million in June 2013 and $75 million in December 2013 from Spark Capital, Matrix Partners, Formation 8 and Andreessen Horowitz.
The latest version of the Oculus Rift developer kit is now available for pre-order for $350, and Oculus expects to start shipping units in July. Sony revealed a competing virtual headset, Project Morpheus, during the 2014 Game Developers Conference; Oculus’ vice president of product, Nate Mitchell, mentioned that it’s in the company’s best interests for Sony to put out a high-quality headset. For more on Project Morpheus, check out our impressions from GDC, along with our thoughts on Sony’s position as a new entrant into the virtual reality space as well as all the virtual reality news from the show.