Microsoft is the only publicly traded company, besides Apple, that enjoys a market cap of over $2 trillion. Founded in New Mexico in 1975, Microsoft’s journey to the $2 trillion club includes many path-breaking acquisitions that have helped the software giant to achieve rare feat despite all odds and failures. Some of Microsoft top acquisitions are:
Microsoft’s LinkedIn acquisition
The most talked about acquisition by Microsoft was LinkedIn. Microsoft Incorporation (NASDAQ:MSFT) made a bold move to acquire LinkedIn, the online professional network, for $26.2 billion. The decision was recognized by the software giant based in Redmond, Washington, the United States, as its most significant acquisition in the company’s history.
Microsoft took over most of LinkedIn’s stock for $196 per share – 50 percent higher than its closing price. The two companies have signed a definitive agreement worth US$2.2 billion.
Prior to this surprising acquisition of LinkedIn, Microsoft had also taken another acquisition step that was no less valuable. Do you have anything in mind?
Microsoft Acquisition Of Hotmail
Microsoft’s acquisition of Hotmail was the second most important acquisition that established the software giant in the world of the Internet. Hotmail was one of the earliest free web email service providers. In 1997, Microsoft acquired Hotmail, the primary email service at the time. The acquisition value reached US$ 400 million, which is in the reasonably high category.
Hotmail went on to become the largest email service for more than a decade. Since being acquired by Microsoft, the number of users and web traffic to Hotmail has increased rapidly.
Hotmail is also integrated with Microsoft web applications such as Windows Live Messenger and SkyDrive. Unfortunately, Hotmail is currently in the closing stages, being replaced with Outlook.
The acquisition by Microsoft put Hotmail on the list of MSN services. Google fought back with Gmail, which launched sometimes later when the competition was already burning. But, Gmail had set a higher bar that couldn’t be reached by others at that time. Each of them gives the most outstanding value market could consider. While Gmail brings the functionality of Google Docs and others, Hotmail users are also able to use services from Microsoft by accessing the Hotmail interface.
These giant companies benefit from the ads displayed on their platforms’ interfaces. They have approached different techniques of ad placement. Gmail users only seed ads presented in text, located in minimal space. Hotmail users were suffering from gigantic graphic ads, which annoying most of the time.
Another Gmail value that outstands Hotmail’s usefulness is the massive limit on sending emails. Gmail allows 20MB for each attachment, while Hotmail only supports half of it. In the case when you need to send something large in size, you need to split it first into several parts by using third-party apps.
Acquisition of aQuantive
The list of Microsoft top acquisitions can’t miss the mention of aQuantive. Acquiring a service provider and advertising software company, aQuantive, in 2007 was believed by Microsoft to compete with Google. At that time, Google acquired DoubleClick, which develops Internet advertising services.
Microsoft spent $ 6 billion for aQuantive. The Seattle-based company has various products for advertisers and publishers, which Microsoft uses a number of technologies for.
According to Business Insider, the two companies weren’t well-integrated, so Microsoft had to change the focus of its advertising strategy. The leadership of aQuantive has also left the company.
Microsoft acquired Skype’s online communication service for US$8.56 billion in May 2011 from the Silver Lake investor group.
It is not the first acquisition of Skype. Before being partially taken over by Silver Lake, eBay had already purchased it in September 2005 for US$3.1 billion.
The wired site proclaims Microsoft’s decision to acquire Skype was announced shortly after Google and Facebook expressed interest in working with Skype.
After being acquired, Skype supports Microsoft devices such as Xbox, Kinect, to Windows Phone. Skype’s acquisition at the time was the largest ever to surpass aQuantive’s purchase value.
Microsoft Acquisition of Mojang
There would be no Minecraft game without the presence of the Mojang company from Stockholm, Sweden. In September 2014, Microsoft bought Mojang for $ 2.5 billion.
Microsoft CEO Satya Nadella considers Minecraft to be a significant gaming franchise and global platform. The company sees the gaming industry as very attractive because it can be played on various devices.
Unfortunately, this acquisition made the founders of Mojang resign and decided to build a new project.
Microsoft manages the Mojang office in Stockholm with about 40 employees. This acquisition is considered not vain; this game’s revenue grew 79 percent to $ 171 million in the last quarter of 2014.
Additional information about this can be gained further. But, be sure to hide the IP address using iOS VPN for your own sake.
Microsoft’s acquisition of Nokia’s mobile phone and services business unit was completed on April 25, 2014. The acquisition value reached US$ 7.2 billion.
Of that amount, as much as US$ 5 billion was disbursed to buy Nokia’s devices and services business unit. In comparison, US$ 2.2 billion was used to license technology patents, and they traded Nokia mobile phones for ten years.
The name of Nokia’s business unit was changed to Microsoft Mobile. Not only that, but Microsoft also killed the Nokia trademark and changed it to “Microsoft Lumia.”
With the purchase of the mobile phone and services business unit, the Nokia Group business group based in Espoo, Finland, relies on the remaining three business units, namely telecommunications infrastructure (Nokia Solutions and Networks), digital map services (Nokia Here), and the technology development unit and patent license (Advanced Technologies).
Other Notable Microsoft Acquisitions:
It is important to note that Microsoft has spent over $63 billion on its top 10 deals, or roughly 7% of its current market capitalization. Each of Microsoft’s top 10 acquisitions is valued at more than $1 billion. One of Microsoft’s first $1 billion+ acquisitions, Navision ($1.3 billion, May 2002), is still its eighth largest deal, while LinkedIn ($26.2B, 2016) remains the company’s biggest acquisition to date.
Some other Microsoft’s biggest acquisitions include Activision Blizzard ($68.7 billion in January 2022), Nuance Communications ($19.7 billion in April 2021), and GitHub ($7.5 billion in October 2018).