The acquisition, the largest in Microsoft CEO Satya Nadella’s tenure, will be “key to our bold ambition to reinvent productivity and business processes,” he wrote in a letter to Microsoft employees. Founded in 2002, Mountain View, Calif.-based LinkedIn had approximately 400 million users in 2015. The company provides a social network alternative for finding professional and work connections, sharing resumes and potentially finding new posts. In 2015, LinkedIn bought Lynda.com for $1.2 billion to help the company boost its online learning/training and talent-development capacities. According to the press release, Jeff Weiner will remain CEO of LinkedIn, reporting to Nadella, CEO of Microsoft. Reid Hoffman, chairman of the board, co-founder and controlling shareholder of LinkedIn, and Weiner both fully support this transaction. The transaction is expected to close this calendar year, subject to the approval of LinkedIn shareholders. “Just as we have changed the way the world connects to opportunity, this relationship with Microsoft, and the combination of their cloud and LinkedIn’s network, now gives us a chance to also change the way the world works,” Weiner stated in a press statement. “For the last 13 years, we’ve been uniquely positioned to connect professionals to make them more productive and successful, and I’m looking forward to leading our team through the next chapter of our story.” Microsoft said it would issue new debt to fund its acquisition.
The deal will require approval from regulators in the United States, the EU, Canada and Brazil, LinkedIn after which it will become part of Microsoft’s productivity and business processes unit, the companies said. “I have always had a great admiration for LinkedIn,” Nadella said in a video on Microsoft’s website. “I have been talking with Reid and Jeff for a while … I have been thinking about this for a long time.” “The LinkedIn team has grown a fantastic business centered on connecting the world’s professionals,” Nadella said in a statement. “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 plans to speed-up monetization of LinkedIn by growing individual and organization subscriptions as well as targeted advertising, it said. After the announcement, LinkedIn’s shares soared 48 percent to $194.00 in early New York Stock Exchange trading and Microsoft’s shares were down 4 percent.
