Microsoft to buy LinkedIn for £18.3bn

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Software giant to acquire professional network in its biggest ever cash deal

Microsoft has agreed a deal to acquire business social network LinkedIn in a deal worth $26.2 billion (£18.3 billion).

With more than 433 million users, LinkedIn has became one of the world’s biggest professional networks since it was founded in 2002 and launched the following year.

Microsoft said Jeff Weiner would remain as CEO at LinkedIn, a role he has held since December 2008. It will also “retain its distinct brand, culture and independence”, Microsoft added in a statement to Wall Street.

“The LinkedIn team has grown a fantastic business centered on connecting the world’s professionals,” Microsoft CEO Satya Nadella said. “Together we can accelerate the growth of LinkedIn, as well as Microsoft Office 365 and Dynamics as we seek to empower every person and organisation on the planet.”

The deal is expected to close before the end of the calendar year, Microsoft said, with all board members for both firm’s already giving unanimous approval.

LinkedIn co-founder Reid Hoffman labelled the sale as a “refounding” for the company. “I see incredible opportunity for our members and customers and look forward to supporting this new and combined business,” he added.

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CCS Insight analyst Martin Garner claimed the move would give Microsoft an opportunity to integrate the world’s biggest professional network with a number of its own assets.

He added: “The justification for an acquisition on this scale has a lot to do with Microsoft’s vision of digitalized businesses running on collaborative and social tools, including its recently articulated Conversation-as-a-Platform. Several key players have a broadly similar vision and it is likely that other players were competing to acquire LinkedIn.

“LinkedIn provides a potential platform for collaborative sharing given its “social network” characteristics, enabling Microsoft to compete more effectively against other challenger services such as Facebook-at-Work and Slack. LinkedIn has several assets in this area including the timeline it offers to users, in-built messaging and tools such as slideshare.

“There are many opportunities for integrating Microsoft services with LinkedIn including Office 365, Exchange, Outlook, skype, CRM (Dynamics) to challenge Salesforce.com more successfully, its enterprise messaging service Yammer, its newer graph services such as Delve, as well as its cloud computing services. It is also a fantastic resource for Microsoft’s artificial intelligence efforts providing a huge amount of data mining opportunities. However it will be a substantial integration challenge to do this quickly and extract maximum value from it.”

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