We probably didn’t expect our week to start this way – Software developers, Microsoft Corp. will acquire business-oriented social networking service, LinkedIn Corp. He hoped to reinvent user process through the products, saying the software combined with LinkedIn’s network could reinvent selling, marketing and talent management business processes while making professionals more productive. Overnight, the deal skyrocketed LinkedIn’s stock by almost 50 percent to $196 per share, as reported by The New York Times.
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In a phone call, LinkedIn CEO Jeff Weiner said his company would remain its own entity in same the way that YouTube is relatively independent from parent Alphabet, and Instagram from parent Facebook.
In a brief video interview posted along with Microsoft’s announcement today, Microsoft CEO Satya Nadella said combining his company’s strengths with LinkedIn’s is something he’s been thinking about for a long time.
So what exactly will Microsoft do with LinkedIn?
“This deal is the next step forward for Office 365 and Dynamics as they connect to the world’s largest and most valuable professional network”, he said. Reid Hoffman, chairman of the board, co-founder and controlling shareholder of LinkedIn, and Weiner both fully support this transaction.
Weiner further assured that, even after its acquisition by Microsoft, the world’s largest professional network will still be maintaining its “distinct brand, culture, and independence”.
“We are in pursuit of a common mission centred on empowering people and organisations”, Nadella explained in an email to employees. The deal is expected to be completed this calendar year. It is still subject to approval by LinkedIn’s shareholders and other regulatory approvals and closing conditions. Microsoft’s $7.2 billion acquisition of Nokia’s phone assets has been an expensive flop.
Microsoft will finance the purchase primarily through new debt, but reiterated that it still intends to finish buying back $40 billion in its stock by the end of this year under its current authorization. Microsoft shares, meanwhile, have fallen 4 percent.
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“Microsoft Dynamics offers businesses an integrated productivity solution”, Nadella said.
