Microsoft buys LinkedIn

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Microsoft is buying LinkedIn for $26.2 billion, the company announced Monday.

Microsoft will acquire LinkedIn for $196 per share which means that the total price will be $26.2 billion. The deal includes all LinkedIn’s net cash.

LinkedIn CEO Jeff Weiner will remain CEO of the social network for professionals, reporting directly to Microsoft CEO Satya Nadella.

Under the terms of the acquisition, LinkedIn will maintain its “distinct brand, culture, and independence” – similar to how Facebook handled its acquisition of WhatsApp.

Reid Hoffman, chairman of the board, co-founder and controlling shareholder of LinkedIn, and Weiner both fully support this transaction.

The transaction is expected to close this calendar year.

Nadella announced the news to Microsoft employees in an email Monday morning, which you can read here. LinkedIn CEO Jeff Weiner also sent an email to staff, which you can read here.

Facts about LinkedIn

  • 19 percent growth year over year (YOY) to more than 433 million members worldwide
  • 9 percent growth YOY to more than 105 million unique visiting members per month
  • 49 percent growth YOY to 60 percent mobile usage
  • 34 percent growth YOY to more than 45 billion quarterly member page views
  • 101 percent growth YOY to more than 7 million active job listings

What happened with the shares

LinkedIn shares raised more than 47% following the news when the markets opened. Microsoft shares, which were halted in pre-market trading pending the news, have since reopened and fallen with about 4%.

Integrating LinkedIn into existing Microsoft software

“This deal brings together the world’s leading professional cloud with the world’s leading professional network”, Nadella wrote in the email.

“I have been learning about LinkedIn for some time while also reflecting on how networks can truly differentiate cloud services. It’s clear to me that the LinkedIn team has grown a fantastic business and an impressive network of more than 433 million professionals”.

Nadella went to mention how Microsoft’s Office software suite could be combined with LinkedIn’s huge network in the future, such as the ability Microsoft to serve up suggestions for a specialised expert though LinkedIn when its software recognises you’re trying to complete a specific task.

LinkedIn will also be able to plug into Office to detect the kind of project you’re working on, which the social network will then find relevant articles to infuse into your LinkedIn feed.

“We are in pursuit of a common mission centred on empowering people and organisations. Along with the new growth in our Office 365 commercial and Dynamics businesses this deal is key to our bold ambition to reinvent productivity and business processes,” Nadella wrote.

“Think about it: How people find jobs, build skills, sell, market and get work done and ultimately find success requires a connected professional world. It requires a vibrant network that 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 news feed that serve 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”.

“As these experiences get more intelligent and delightful, the LinkedIn and Office 365 engagement will grow. And in turn, new opportunities will be created for monetization through individual and organisation subscriptions and targeted advertising.”

Hear what Nadella and Weiner said about Microsoft acquiring LinkedIn.

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