Facebook Inc., has received the go-ahead from antitrust regulators in the United Kingdom to move forward in purchasing Kustomer Inc., a New York-based software company, according to a Monday (Sept. 27) report from Bloomberg.
The social media giant is looking to spend $1 billion on the customer service company, per the report. Regulators determined that the deal would not likely result in diminished competition.
Facebook first announced its acquisition of the chatbot company in November, as PYMNTS reported. Kustomer, which was founded in 2015 by Chief Executive Officer Brad Birnbaum and Chief Technology Officer Jeremy Suriel, is an omnichannel software-as-a-service (SaaS) and customer relationship management (CRM) firm. Facebook had initially eyed the company as a means of bolstering its WhatsApp messaging service, which has surged in popularity amid the COVID-19 pandemic.
Read more: Facebook to Acquire Chatbot Startup Kustomer
The acquisition had been under scrutiny for some time. In July, the European Union readied what was reported to be a 90-day antitrust probe of the Kustomer purchase.
EU antitrust regulators opted to look more closely at the Facebook-Kustomer deal as it focuses more in-depth investigations on tech, pharma and biotech startups. The purpose of the probe was to look for warning signs of “killer acquisitions,” in which big companies buy out rivals to squash competition — something Facebook has been accused of before.
In June, Facebook closed above $1 trillion in the market for the first time ever, making it the fifth company following Apple, Microsoft, Amazon and Google parent Alphabet to gain that distinction. Facebook’s revenue is generated almost entirely from advertisements that users see while scrolling the social media site, as well as its other social media site, Instagram. Facebook is also working on a video-calling device and new virtual reality headsets from Oculus.
More details: Facebook Hits $1T Market Cap