The all-cash deal is intended to improve Microsoft’s cloud offerings.
Microsoft recently announced it would acquire LinkedIn for $25.6 billion in an all-cash transaction. The computing giant bought the popular social network, an essential social media platform for most professionals, to improve the position of its enterprise suite of software and to expand its Bing Ads’ offerings to the LinkedIn platform.
“The LinkedIn team has grown a fantastic business centered on connecting the world’s professionals,” Microsoft CEO Satya Nadella said. “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.”
While the deal will bring LinkedIn into the Microsoft family, LinkedIn will retain much of its independence. Current CEO Jeff Weiner will remain in his role but will report to Microsoft CEO Satya Nadella, and LinkedIn will keep its distinct brand and culture. The deal is supported by Weiner and LinkedIn Chairman of the Board, Co-Founder and controlling shareholder, Reid Hoffman.
“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 also to change the way the world works,” Weiner said. “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.”
LinkedIn has become one of the most popular social media networks in the world by focusing on professional and business world. The “Facebook for Work” has been able to occupy a space that co-exists with other social media platforms because it is only intended for a specific kind of sharing, that which is geared toward work and professional development.
To enhance its positioning in that regard, LinkedIn has improved its news feed to focus on business insights, acquired Lynda.com, a popular online learning platform, and has grown its job offerings to recruiters and job seekers. These strategies have led to impressive user engagement stats and financial results.
LinkedIn now has over 433 million members globally, with more than 105 million unique visitors each month. Roughly 60 percent of its users access the platform on mobile as well as desktop.
As a job resource, the company offers over 7 million active job listings and it members pages are getting viewed 45 billion times per quarter. Microsoft is hoping to capitalize on these impressive statistics and grow them. As well as utilize LinkedIn’s technology and engineers to develop its new offerings.
“Today is a re-founding moment for LinkedIn. I see an incredible opportunity for our members and customers and look forward to supporting this new and combined business,” said LinkedIn’s Hoffman about the deal. “I fully support this transaction and the Board’s decision to pursue it, and will vote my shares by their recommendation on it.”
There will be challenges to integrating two big tech companies according to some observers. But LinkedIn and Microsoft seem optimistic about the potential benefits of their combination and believe the two companies complement each other and will be able to blend well.