No one would have ever imagined the day, when the huge software company giant Microsoft would have bought the social media network giant LinkedIn in its latest deal. The deal which was done and confirmed on 13th June 2016, is said to be amongst the most expensive and largest deal in information technology.
After Flipkart acquiring Myntra, Facebook acquiring WhatsApp and the recent one Snapdeal acquiring Freecharge, the unexpected recent deal is between Microsoft and LinkedIn, which is one of the most costly deal in the information technology market.
TO give a brief description about both the companies, for those who aren’t aware, it may be given as:
LinkedIn, was the company founded in the year 2002 and was made to public use (launched) on 5th May 2003. The company was founded by Reid Hoffman and also many of the founding members were form PayPal and Socialnet.com. It was started in order to focus more on professionalism and from the corporate point of view. It is a business-oriented social networking service. The present CEO of the company is Jeff Weiner.
Talking about Microsoft, as we all know this company best in terms of its operating system, the windows operating system. It began in the year 1975, when it was founded by Bill Gates and Paul Allen. Some of its current best-selling products and services include: Microsoft Windows (Operating System), Microsoft Office (Office based Software Applications), Xbox (Gaming), Bing (Search Engine). The present CEO of Microsoft is Satya Nadella.
Both companies worked in totally different fields, one in social media and the other in software and hardware. The recent diversification of Microsoft was, when the company had bought the Mobile Company Giant, Nokia. The next big deal Microsoft is into, buying LinkedIn.
Microsoft has bought LinkedIn for USD 26.2 Billon ($26.2 Bn.). This figure turns out to be such, as Microsoft acquires LinkedIn for $196 per share in an all cash transaction, which makes the net worth to be 26.2 Billon Dollars (17,58,020 Crores in Indian Rupees). This deal is one of the major deal in the IT industry, which will affect the IT market accordingly.
LinkedIn will consist of 48% stakes in terms of shareholdings and the CEO (Chief Executive Officer) of the company will remain the same that is Jeff Weiner will remain the CEO of the company, reporting to Satya Nadella.
Some key points to keep in mind about the deal:
1. Acquisition amount: $26.2 Billions
2. Deal is in all cash transaction with $196 per share.
3. CEO of the company remains the same. Jeff Weiner being the CEO, will report to Satya Nadella.
4. Both the companies, board of members have agreed upon the deal and are happy with the acquisition.
5. Largest deal under Satya Nadella’s tenure of CEO.
6. Morgan Stanley is the financial advisor for Microsoft, while for LinkedIn it is Allen and Company LLC.
Under the terms of acquisition, LinkedIn will maintain its brand, culture and independence. The deal is expected to be completed this year.
Article written and submitted by: Akshay Rakesh Toshniwal