Business social media network LinkedIn was agreed to buy by microsoft

Microsoft has announced that it is acquiring LinkedIn, the social network for professionals with some 433 million users, for $26.2 billion, or $196 per share, in cash. The transaction has already been approved by both boards, but it must still get regulatory and other approvals.
If for some reason the deal does not go through, LinkedIn will have to pay Microsoft a $725 million termination fee, according to Microsoft’s SEC filing detailing the merger.

How does this work: 

This is  a big deal of course for Microsoft, it’s bringing a key, missing piece into the company’s strategy to build out more services for enterprises, and give it a key way to compete better against the likes of Salesforce (which it also reportedly tried to buy).

Microsoft's core focus was into software and some hardware by way of its very downsized phones business. But LinkedIn will give Microsoft a far bigger reach in terms of social networking services and professional content — developing the early signs of enterprise social networking that it kicked off with its acquisition of Yammer for $1.2 billion in 2012. LinkedIn’s wider social network, pegged as it is to groups of employees and employers, will give Microsoft a sales channel to sell more of its products, and will serve as a complement to those that it already offers for collaboration and communication.

Microsoft has never been a massively successful company when it comes to social networking — although it smartly invested in Facebook before it went public, and as it has been reported before it was apparently interested at one point in trying to make a bid to buy Slack for $8 billion. LinkedIn’s social network will give it a significant foothold in this area.

Microsoft will acquire LinkedIn for $196 per share in an all-cash transaction valued at $26.2 billion, inclusive of LinkedIn’s net cash. LinkedIn will retain its distinct brand, culture and independence. Jeff Weiner will remain CEO of LinkedIn, reporting to Satya 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.