Microsoft has just made the surprise announcement that it is acquiring LinkedIn for $26 billion in cash in what will be the firm’s biggest acquisition to date. Reports indicate that LinkedIn will keep its product and branding, but CEO Jeff Weiner will begin reporting to Microsoft’s Satya Nadella.

Both firms’ boards have approved the deal, but regulatory and shareholder approval is pending. The transaction is expected to close some time before the end of the year.

The move is expected to boost Microsoft’s efforts to build out enterprise services and compete with Salesforce. LinkedIn’s social network is strongly tied to groups of employees, which will provide a handy sales channel to help it move products.

LinkedIn currently has around 433 million users, 105 million of whom are monthly active users. It has a foothold in more than 200 countries and boasts 45 billion quarterly page views. It is also one of the biggest sources of job listings, counting 7 million active listings at the moment.

Microsoft sees this as a chance to bring professionals tools to boost their productivity, such as Office 365 and Dynamics. They also plan to use targeted advertising and subscriptions to bring in more profits.

In a statement, Nadella said: “The LinkedIn team has grown a fantastic business centered on connecting the world’s professionals. 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.”

Microsoft is expected to integrate the social network into its own services and apps, including Cortana and Skype. This move is in line with Microsoft’s recent shift away from depending on Windows toward building up cloud services.

LinkedIn stock jumped nearly 50 percent after the announcement was made. The news is giving LinkedIn some positive headlines after a recent major data breach that affected nearly a quarter of its members.

LinkedIn acquired the online learning business back in April 2015 for $1.5 billion, and Microsoft is also believed to be eyeing the service as a way to help sell its software products and teach people how to use them.

LinkedIn Co-founder and Chairman Reid Hoffman expressed his support for the deal, stating: “Today is a re-founding moment for LinkedIn. I see incredible opportunity for our members and customers and look forward to supporting this new and combined business.”

Tobias Matthews

Tobias Matthews


Writer at Fourth Source.