(MENAFN - ProactiveInvestors - N.America) Software giant Microsoft Corp. (NASDAQ:MSFT) has agreed to acquire enterprise social networking firm Yammer in a cash deal pegged at 1.2 billion.
Yammer, designed for company collaboration, file sharing, knowledge exchange, will become part of Microsoft's Office segment.
The company will continue to be led by chief executive David Sacks.
"The acquisition of Yammer underscores our commitment to deliver technology that businesses need and people love," Microsoft's CEO Steve Ballmer said in a statement.
"Yammer adds a best-in-class enterprise social networking service to Microsoft's growing portfolio of complementary cloud services."
Additionally, Yammer will also continue to develop its standalone service. Microsoft plans to expedite Yammer's adoption alongside Microsoft SharePoint, Office 365, Microsoft Dynamics and Skype.
The basic version of Yammer is free, but customers can pay to upgrade their network to get advanced administrative and security controls. The social networking company has about five million corporate users.
The acquisition is subject to customary closing conditions, including regulatory approval.
Microsoft's share price traded 3.26 per cent lower at 29.70 each on the Nasdaq on Monday afternoon.