Company Acquires Skype for 8.5 Billion

On 10/05/2011, Microsoft announced it would acquire internet communications company Skype for $8.5 billion in cash, marking the largest acquisition in the company’s history at the time. The purchase price included the assumption of approximately $686 million in Skype debt. Microsoft said the acquisition would expand its capabilities in voice and video communication across consumer and enterprise products. Microsoft planned to integrate Skype technology into services such as Xbox, Outlook, and Windows Phone, as well as enhance real-time communication features across its software ecosystem. Following the announcement, Skype was structured as a new business division within Microsoft, led by Skype CEO Tony Bates, who reported directly to Microsoft leadership. The company stated that Skype’s global user base and communications infrastructure would complement its cloud and collaboration offerings. The transaction required regulatory approvals in multiple jurisdictions and was completed on 13/10/2011. After closing, Microsoft began integrating Skype into products including Xbox Live, Windows, and later Microsoft collaboration tools. The May 2011 announcement represented a major expansion of Microsoft’s communications strategy.