Microsoft has officially announced that it has brokered a deal to purchase Linkedin Inc. which is known for LinkedIn.com, the most popular social networking website for professionals in the world which has over 400 million users. The deal was announced early this week and the agreed amount for the sale is a mind blowing 26.2 billion US dollars. Microsoft stated in the announcement that it will pay 196 US dollars for each LinkedIn share which is 50 percent higher than LinkedIn’s closing share price last Friday.
Microsoft, however stated that LinkedIn will still retain its own brand, culture, and independence. Also, LinkedIn CEO Jeff Weiner will remain as CEO, but will report directly to Microsoft CEO Satya Nadella. Some might be wondering why Microsoft is paying such a huge amount for LinkedIn and whether it will be profitable in the long run, Microsoft’s management believes that its per-share earnings will increase through this acquisition. They also plan to integrate existing Microsoft software into Linkedin
Microsoft CEO, Satya Nadella had this to say “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. 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 organization subscriptions and targeted advertising.” The deal is expected to be sealed within this year 2016.