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What’s the scoop on the Linkedin and Microsoft acquisition?

Linkedin and MicrosoftIn early June a major announcement was made – Microsoft purchased LinkedIn for a whopping $26.2 billion (USD), the entire acquisition is set to complete by the end of this year.  This is the largest acquisition in Microsoft history. The next largest acquisition in Microsoft’s history was the purchase of Skype in 2011 at $8.5 billion (USD). It’s true that tech companies go through mergers and acquisitions frequently, but for some reason this deal has caught many off-guard. Mainly because Microsoft’s historic mergers and acquisitions haven’t been a successful venture.

According to a press release from Microsoft, the transaction was unanimously approved by the Boards of Directors of both Linkedin and Microsoft, and LinkedIn’s CEO Jeff Weiner was fully supportive of the deal.

Microsoft is striking when the proverbial iron is hot. LinkedIn recently acquired online learning platform Lynda.com which resulted in a significant uptick of membership, engagement, subscriptions, and essentially finances. Specifically, LinkedIn reported the organizations previous efforts in conjunction with Lynda’s platform have meant:

  • 19 percent growth year over year (YOY) to more than 433 million members worldwide
  • 9 percent growth YOY to more than 105 million unique visiting members per month
  • 49 percent growth YOY to 60 percent mobile usage
  • 34 percent growth YOY to more than 45 billion quarterly member page views
  • 101 percent growth YOY to more than 7 million active job listings

This is activity on LinkedIn’s front is appealing to Microsoft for the gains it can receive from LinkedIn – it can be argued that LinkedIn and Microsoft share a demographic pool: professionals, literate, globally located. Not to mention LinkedIn comes with a plethora of data that Microsoft does not currently own.

Microsoft reports that even with the acquisition Weiner will remain at the helm and the company will retain its brand, culture, and independence. (LinkedIn headquarters just moved into an incredibly fancy, new building in San Francisco).

Microsoft plans to integrate the Office product suite and the company’s customer relationship management system (Microsoft Dynamics) with LinkedIn to keep up with competitor, Salesforce.

Time will tell how this deal plays out. As a user of LinkedIn, pay attention to the subtle changes which may be on the horizon.

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