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Microsoft To Purchase Yammer

Microsoft is buying the social media site Yammer.

June 26, 2012– Microsoft Corp announced on Monday that it has agreed to purchase Yammer, Inc. the corporate social-network. The purchase price is $1.2 billion. The acquisition by Microsoft will help it woo companies with tools like Facebook that help employees to collaborate at work.

Yammer is based in San Francisco and will be part of the Office division at Microsoft and it will continue reporting to David Sacks the current CEO of Yammer, the two companies announced in a prepared statement.

Yammer has features that are similar to ones found on the social network site Facebook and are used by over 200,000 businesses such as EBay, Inc and  Ford Motor Co. The new purchase will help Microsoft to compete with other corporate-social businesses such as Salesforce.com Inc and Jive Software.

One analyst said that Microsoft had been trailing in social terms and the new acquisition now put them in a very strong position, possibly even out front. Sacks founded Yammer in 2008. He was the former PayPal Inc Chief Operating Officer. Since 2008, the company has raised in excess of $140 million from a number of venture capital firms.

Microsoft will integrate Yammer into its own products but will also continue to have it run as a standalone product. The deal is expected to be completed sometime during the third quarter of 2012.

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