http://www.reuters.com/article/us-linkedin-m-a-microsoft-idUSKCN0YZ1FP Microsoft Corp (MSFT.O) agreed to buy LinkedIn Corp (LNKD.N) for $26.2 billion in cash, the companies said in a statement on Monday. The offer of $196 per share represents a premium of 49.5 percent to LinkedIn's Friday closing price. "Today is a re-founding moment for LinkedIn," Reid Hoffman, chairman of LinkedIn's board, said in a statement. Jeff Weiner will remain chief executive of LinkedIn, reporting to Microsoft CEO Satya Nadella. The deal is expected to close in 2016.
I may be underestimating LinkedIn, I mean I update my stuff and what not, and I could see where it is low cost to maintain and high profit from advertising, but what is the long term value of all these interconnected members for microsoft?
That's a lot of change for a glorified job board - which is basically how LinkedIn makes money. LinkedIn growth I'm pretty sure had basically stalled. It's a great move for them. For Microsoft, an acquisition like this makes sense... I just don't know if this is the exact right one. Youd almost rather just buy Slack for a crazy crazy ridiculous valuation. Not $26 billion but some crazy premium over their last round. Of course they don't seem like they want to sell. But that would have been the smarter move imo. Follow the fb model -'pay crazy prices but for seriously growing companies. Plus slack is mobile first whereas LinkedIn does t really move the needle there. Somewhat of a head scratcher for msft
Seems Msft was attracted to LI's social SW tools and of course content. LI has been moving more towards sales tools... so this helps Msft compete with Salesforce. And LI is one humongous database of professionals, executives and other sales targets...
I like LinkedIn future quite a bit, but I'm not quite understanding this from MSFT perspective and I'm concern it's a failure for both.
I'm not sure Linkedin's social software tools are worth much. Don't think their sales tools are worth much. I've never heard them really compete with Salesforce in any remotely meaningful way. It is a database of people, and a jobs board. I think it's the wrong acquisition target for them, but it could work.
Bingo. It's mostly about the data. Even the job board isn't anything special. Linkedin has been struggling for a while since they've had trouble keeping people on Linkedin premium and their revenue model really depends on Linkedin Premium. I'm still not sure how Microsoft wants to use the data or the product. We can speculate all day long but the truth is that no one has any idea what MS plans on doing. But someone was bound to buy Linkedin at some point. I expected Facebook (or even Google but I think they're permanently scarred by social media) to eventually buy them out. I guess Microsoft beat both of them to the punch.
I hope they keep their engineers and learn a thing or two from them. Not a fan of MS, but Google/Apple/Amazon are too powerful. I don't really use Linkedin other than for career stuff, and I think both sides realize that early on.
Value of each company combined vs as separate going forward is the reference. There are plenty of multi-B deal that end up as failure for both.