Microsoft Rumored to Buy Enterprise Social Network Yammer in a Billion-Dollar Deal

A latest report in the tech media world is drawing everyone's attention. Yes, the talk is about Microsoft, which is reportedly on the edge of acquiring online networking company Yammer in a deal potentially worth over $1 billion. Two people familiar with the matter has informed the folks at Bloomberg that Microsoft Corp is in discussions with Yammer Inc. to buy the company.

As a piece of information for you, Yammer is used primarily as a tool for group communication and collaboration within companies and started off, looking very much like an early version of Facebook.

Unlike Mark Zuckerberg's creation, however, Yammer proudly proclaims itself "the enterprise social network" and offers no pretense of competing in the casual socialization stakes.

According to Bloomberg reports, they have suggested that a deal between Microsoft and Yammer could be sealed as soon as this Friday, and an unnamed source has indicated the online news agency that the price could be above the billion dollar mark.

Why Acquire?

Adding Yammer would help Microsoft, the world's largest software maker, add social-networking tools to the suite of products it offers corporate customers. A deal with Yammer also would step up competition with Salesforce.com  which gained social-marketing tools through its $745 million purchase of Buddy Media Inc. earlier this month, and Oracle, which recently bought two companies that analyze data on social-media sites -- Vitrue and Collective Intellect.

Both Microsoft and Yammer have not disclosed any information in the support of the matter and continue to remain tight-lipped for right now.

Yammer, started in 2008, is used by more than 200,000 companies, including Ford Motor Co. and EBay Inc. It provides features for internal corporate use that are similar to those found on Facebook Inc.'s website.

The San Francisco startup was founded by David Sacks, the former chief operating officer at PayPal Inc. It has raised more than $140 million in funding from venture firms, includingCharles River Ventures Inc. and Emergence Capital Partners.

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