Microsoft to Pay $8.5 Billion in Cash for Skype
May 10, 2011 by admin
Big money, to the tune of $8.5 billion, was on the table and Skype took it all, from Microsoft. With the deep pockets that come from being a company named Microsoft Corp., the amount paid is astounding, but not unimaginable. In fact, Microsoft paid $6 billion in 2007 to buy aQuantive, an online advertising company. And that’s to say nothing of Microsoft’s “withdrawn” $48 billion offer to buy Yahoo in 2008. The current all-cash deal will likely be finalized before the end of the year; the buy’s currently awaiting regulatory approval.
Tony Bates, Skype Global’s sitting chief of staff, will continue to be at the helm of Skype as it transforms into the new Microsoft Skype Division. He had the following to say about the deal: “Together, we will be able to accelerate Skype’s plans to extend our global community and introduce new ways for everyone to communicate and collaborate.” Silver Lake Partners leads the investment group that owns Skype.
The buy comes after years of Microsoft trying to become “a verb” as Steven A. Ballmer, Microsoft’s CEO, most pointedly said recently. Without mentioning verb-y Google, Mr. Ballmer let it be known that Microsoft was very pleased to be able to acquire a platform that comes joined to millions of dedicated and active users. He’s right about that — on average, Skype has 107 million users per month whose connection time totals more than 100 minutes.
Finally, Steven Ballmer also said that his company’s consumers should soon expect to see Skype’s technology for voice and video make an appearance in well-known Microsoft products. Plans for expanding Skype’s business and revenue are clearly in the works.