Software giant Microsoft announced on Monday that it will acquire social network LinkedIn for 26.2 billion U.S. dollars, to seek new growth opportunities for its business productivity tools.
Under a definitive agreement, Microsoft will buy LinkedIn for 196 dollars per share in cash and the transaction is expected to close this year.
The deal, the biggest in Microsoft's history, is to bring together the world's leading professional cloud with the world's leading professional network, Microsoft said.
Microsoft, which has moved its Office software from a set of productivity tools to a cloud service and now has 1.2 billion users, finds a connection with LinkedIn, which runs an online network connecting 433 million professionals worldwide.
Microsoft CEO Satya Nadella pointed out in an email to employees that when people find jobs, build skills, sell, market and get work done, they need a connected professional world which brings together a professional's information in LinkedIn's public network with the information in Office 365 and Dynamics.
"This combination will make it possible for new experiences such as a LinkedIn newsfeed that serves up articles based on the project you are working on and Office suggesting an expert to connect with via LinkedIn to help with a task you're trying to complete," Nadella said.
"As these experiences get more intelligent and delightful, the LinkedIn and Office 365 engagement will grow," he said. "And in turn, new opportunities will be created for monetization through individual and organization subscriptions and targeted advertising."
Both companies believe there's a significant opportunity to accelerate LinkedIn's growth and the value it brings to its members with Microsoft's assets.
"Together we can accelerate the growth of LinkedIn, as well as Microsoft Office 365 and Dynamics as we seek to empower every person and organization on the planet," Nadella said in a statement.
As part of the deal, Jeff Weiner will remain CEO of LinkedIn and report to Nadella, while LinkedIn will retain its distinct brand, culture and independence.
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