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AZ Tech Beat | May 29, 2017

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Microsoft Spends A Whopping $1.2 Billion To Acquire Yammer: The Enterprise Social Network

Microsoft Spends A Whopping $1.2 Billion To Acquire Yammer: The Enterprise Social Network
Reid Simpson

Earlier this month, reports came out suggesting that Microsoft was under acquisition negotiations with the enterprise social network, Yammer. Well, it’s now official, but it took $1.2 billion in cash to make it happen.

David Sacks the former COO of PayPal (until it was acquired by eBay) is the Founder and CEO of Yammer, Inc. Backed with venture capital and launched during the Great Recession, Yammer has certainly fought for its life during the past four years.

Launched in 2008, San Francisco’s Yammer now has over 5 million corporate users spanning across 85% of the elite Fortune 500 companies. Yammer is a free service which enables team members to join a secure, private social network and collaborate instantly on company-wide initiatives.

Microsoft CEO Steve Ballmer commented on this recent purchase by saying,

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

A few eyebrows have been raised over this high purchase price, and Microsoft keeping the story “hush-hush” until after the launch of the Surface tablet and new version to the Windows Phone. Do you think Yammer is worth the full cash value of $1.2 billion?

However, a happy David Sacks and instant mega-millionaire said these final words in regards to his dealings with Microsoft,

When we started Yammer four years ago, we set out to do something big . . . We had a vision for how social networking could change the way we work. Joining Microsoft will accelerate that vision and give us access to the technologies, expertise and resources we’ll need to scale and innovate.

Similar to Microsoft’s Skype, Yammer will continue to be a standalone service maintaining its commitment to simplicity, innovation, and cross-platform experiences. In the near future, look for Yammer to be included in the Office Division of Microsoft’s complementary services alongside Microsoft SharePoint, Office 365, Microsoft Dynamics, and Skype.

Outside of minor closing conditions, and David Sacks needing to make one rather large deposit at the bank, this deal is officially CLOSED.