Reuters: Regulatory News: Facebook faces extended US review of Instagram deal

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Facebook faces extended US review of Instagram deal May 29th 2012, 21:16 Tue May 29, 2012 5:16pm EDT May 29 (Reuters) - Facebook has received notice that U.S. antitrust regulators will give its proposed purchase of the popular photo-sharing app maker Instagram a lengthy investigation, an industry source told Reuters on Tuesday. Facebook has received a "second request" from the Federal Trade Commission, essentially a request for relatively large amounts of data that the regulators will sift through to ensure that the deal complies with antitrust law. A prolonged review adds another headache to the No. 1 social network, whose shares on Tuesday slid below $29 to a new low as nervous investors continued to show their concerns about Facebook's long-term business prospects and its rich initial public offering price of $38. Facebook announced in April that it would purchase Instagram for $1 billion in cash and stock, in its largest-ever acquisition. The "second request" letter from the FTC is dated May 16, the source said.

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