Microsoft announced on Monday that it is is buying LinkedIn for $26.2 billion. Microsoft will pay $196 per share for the company. However, the CEO of LinkedIn, 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 and Microsoft says LinkedIn co-founder and chairman Reid Hoffman and Weiner “both fully support” the purchase, with both boards signing off. The deal is expected to be completed this calendar year.
LinkedIn shares jumped 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 about 4%.
Nadella announced the news to Microsoft employees in an email Monday morning, explained that the deal brings together the world’s leading professional cloud with the world’s leading professional network. He said:
“This deal brings together the world’s leading professional cloud with the world’s leading professional network. 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 explained further on how Microsoft’s Office software suite could be combined with LinkedIn’s network in the future, such as the ability for Microsoft to serve up suggestions for a specialized expert through LinkedIn when its software recognizes 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 use to surface relevant articles to infuse into your LinkedIn news feed.
“We are in pursuit of a common mission centered on empowering people and organizations. 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.
“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,” he added.