Despite cutting their losses in the smartphone market and trying to spin off 2014 acquisition Nokia into the night, Microsoft has announced it is now buying the business focussed social networking site, LinkedIn, for a massive $26.2 billion.


The deal will be Microsoft’s biggest ever purchase and is Chief Executive Satya Nadella’s latest effort to push Microsoft in new directions. Nadella hopes the deal will open new horizons for Microsoft’s Office suite as well as LinkedIn, both of which have seen little change to their relatively dominant market positions in their respective arenas.

“The LinkedIn team has grown a fantastic business centred on connecting the world’s professionals,” 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.” – Hmmmn.

The cost to Microsoft is that they have agreed to pay $196 per LinkedIn share, a 50% premium to the social network’s closing price on Friday. I don’t know about you, but that does seem like quite an expensive bit of virtual real estate.

As far as LinkedIn is concerned, little will actually be changing in the short term. Jeff Weiner is remaining the CEO of LinkedIn, but will now have to report to Satya Nadella, the CEO of Microsoft, which probably isn’t the worst boss he could have.

“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 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.”

The deal dwarfs all other Microsoft acquisitions to date. When Microsoft acquired Nokia back in 2014, Microsoft paid almost $10 billion. That deal was organised by the previous Microsoft chief exec Steve Ballmer. Nadella must be hoping that this one will be more successful.