In its biggest deal to date, Snap Inc. has acquired augmented reality startup WaveOptics for $500 million. Snap, the parent company of Snapchat, was already familiar with WaveOptics before the deal, with the U.K.-based company supplying the displays for the latest version of Spectacles, Snap’s AR-powered smart sunglasses.
The Verge was the first outlet to report the news on Friday.
Snap will pay for half of the deal in stock now, and in two years, it’ll pay the other half in either stock or cash.
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WaveOptics was founded in 2014 and has raised $65 million to date, per The Verge, and has a team of about 125 people. Those employees will now report to Steen Strand, head of Snap’s hardware division.
Snap CEO Evan Spiegel has made clear several times in the past he’s bullish on the future of AR. And coincidentally, Snap unveiled the latest version of Spectacles, which has spiffy new AR filters, on Thursday. Those glasses will initially only be available to a select group of developers and creators.
Prior to Friday’s deal, Snap’s biggest acquisition came a few years ago, when it paid $213 million for Zenly, a company known for its mapping technology.
Snap’s share price was up about 0.2% on Friday morning to $57.08 per share.