Facebook IPO: Instagram worth more, no longer closing in Q2 2012

Facebook today filed its seventh amendment for its IPO filing, meaning the numbers for its Instagram purchase have changed yet again. Furthermore, Facebook has removed the part where it says it will close the Instagram acquisition this quarter.

Last month, Facebook announced plans to acquire Instagram for approximately $1 billion in cash and stock, although Instagram reportedly wanted $2 billion from Facebook. The price ended up being much more flexible: Facebook paid $300 million in cash and 23 million shares for Instagram, and there's a $200 million break-up fee if the deal doesn't go through.

Facebook today announced an increased IPO price range between $34 and $38. Given the 22,999,412 shares, Instagram will be valued at anywhere between $1,081,980,008 and $1,173,977,656. In other words, we're well above the $1 billion mark now.

Facebook was previously expecting to close the Instagram acquisition this quarter. This is no longer the case, given that the Federal Trade Commision (FTC) has gotten involved; the routine investigation could take anywhere between six and 12 months. Rumor has it that Google and Twitter are already being questioned.

Here's the relevant text from the sixth amendment:

This acquisition is subject to customary closing conditions, including the expiration or early termination of all applicable waiting periods under the Hart-Scott-Rodino Antitrust Improvement Act of 1976, as amended (HSR), and is currently expected to close in the second quarter of 2012.

Here's the corresponding text from the seventh amendment:

This acquisition is subject to customary closing conditions, including the expiration or early termination of all applicable waiting periods under the Hart-Scott-Rodino Antitrust Improvement Act of 1976, as amended (HSR), and is expected to close in 2012.

Even after Facebook goes public, the value of Instagram will not be finalized for months. The final value will still be $300 million plus whatever the shares are worth when the deal closes. Only then will we know much Menlo Park values the mobile photo app for Android and iOS. Regardless of what that ends up being, I think the general consensus will be that it's a huge amount of money.

See also:

• FTC probing Facebook's Instagram buy, IPO date threatened?
• Facebook buying Instagram for $300 million, 23 million shares
• Instagram co-founder turned down a job from Mark Zuckerberg
• 10 ways Instagram is to Facebook as YouTube was to Google
• Facebook still has the cash to buy many more Instagrams
• Instagram now top iPhone app
• Bet on Facebook's next buy: Foursquare? Dropbox? Pinterest?
• Why Facebook acquired Instagram for $1 billion