IT’S OFFICIAL! Microsoft Will Acquire Yammer for This Hefty Sum

About a week after reports said Microsoft (NASDAQ:MSFT) would acquire social networking firm Yammer, the two have cut a deal, subject to regulatory approval, that will see the former buy the latter for $1.2 billion in cash.

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Yammer will join the Microsoft Office Division and will be led by its current CEO, David Sacks, the companies said Monday in a statement. Microsoft said Yammer will exist alongside its other products including Office 365, SharePoint, and Skype, which Microsoft acquired in 2011.

“The acquisition of Yammer underscores our commitment to deliver technology that businesses need and people love,” said Microsoft CEO Steve Ballmer. “Yammer adds a best-in-class enterprise social networking service to Microsoft’s growing portfolio of complementary cloud services.”

In a blog post, Kurt DelBene, president of the Microsoft Office Division, explained how the acquisition will improve enterprise social networking:

“The combination of Yammer, SharePoint and Office 365 will provide the most comprehensive and flexible solutions for enterprise social networking. Over time, I see opportunity for exciting new scenarios by adding Yammer’s stand-alone service alongside and integrated into our collaboration offerings with SharePoint, Office 365, Dynamics and Skype… I picture people being able to use Yammer to manage and expand their professional relationships, share and collaborate on Office documents, stay informed about content updates, and to seamlessly move from status updates and feeds into voice and video conversations.”

Meanwhile, Yammer has already notified users that their experience with the system will not change.

Yammer provides features — similar to those found on Facebook (NASDAQ:FB) — to more than 200,000 companies including Ford (NYSE:F) and eBay (NASDAQ:EBAY). The acquisition will help Microsoft compete with corporate-social features like Salesforce.com’s (NYSE:CRM) Chatter product.

Microsoft will add Yammer’s corporate-social networking tools to its Office and SharePoint software products for businesses, but will also continue to offer it as a standalone service, DelBene said on a conference call. Though he couldn’t say when Yammer features will appear in Microsoft’s Office 365 cloud-based applications or in SharePoint, he said the cloud apps get updated quarterly, or even monthly in some cases.

Yammer currently works with Apple’s (NASDAQ:AAPL) iPhone and Google’s (NASDAQ:GOOG), and that will continue under Microsoft, the companies said, despite the fact that the they compete in the mobile space.

The deal is expected to be completed in the third quarter.

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