Redmond, Wash.-based tech giant Microsoft Corp. announced on June 13 that it would be acquiring Mountain View, Calif.-based professional social network LinkedIn Corp. for $196 USD per share, or $26.2 billion USD.

In a joint press release, both companies said that LinkedIn will remain a distinct entity, with CEO Jeff Weiner, who fully supports the acquisition, retaining his position and reporting to Microsoft CEO Satya Nadella.

LinkedIn chair, co-founder, and controlling shareholder Reid Hoffman also gave his blessing to the transaction, which is expected to close later this year, the companies said.

In a statement, LinkedIn CEO Weiner said the acquisition would give LinkedIn a valuable opportunity to take advantage of Microsoft’s cloud network.

Nadella, meanwhile, sent an email to Microsoft employees saying the acquisition would not only allow LinkedIn to grow, but improve the services provided by his own company’s Office 365 and Dynamics CRM software as well.

“[With an acquisition,] I consider if an asset will expand our opportunity — specifically, does it expand our total addressable market? Is this asset riding secular usage and technology trends? And does this asset align with our core business and overall sense of purpose?” Nadella wrote. “The answer to all of those questions with LinkedIn is squarely yes.”

By combining LinkedIn’s professional network with the information stored by Office 365 and Dynamics, Nadella wrote, the companies could add new features such as a LinkedIn newsfeed that serves up articles based on a user’s current projects in Office, or have Office suggest an expert through LinkedIn who can help with a current task, potentially increasing user engagement on both platforms.

Each company’s board of directors unanimously approved the transaction, which is still subject to approval by LinkedIn’s shareholders and various regulations. While Microsoft will be incurring new debt to finance the acquisition, the company said it expects the acquisition to have an impact of less than one per cent on its earnings between now and 2018.

Founded in December 2002, LinkedIn has recently been subject to less-than-flattering press, after some 117 million passwords were released last month in relation to a 2012 data breach, but the company’s overall numbers are still impressive: having recently introduced a new mobile app, 60 per cent of LinkedIn members now access the network on their smartphones, a 49 per cent increase over last year; active job listings have more than doubled during the same period, to more than 7 million; and the number of members worldwide has grown by 19 per cent, to more than 433 million.

Microsoft and LinkedIn will be hosting a joint conference call to provide investors with more information on June 13 at 8:45 AM PST/11:45 AM EST to discuss the transaction. The companies also released the video below.

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