Microsoft buys Skype service for $8.5 Billion

Entering into an definitive agreement Microsoft has announced to acquire Skype for $8.5 billion in cash from the investor group led by Silver Lake. The agreement has been approved by the boards of directors of both Microsoft and Skype. The acquisition will increase the accessibility of real-time video and voice communications, bringing benefits to both consumers and enterprise users and generating significant new business and revenue opportunities. The deal that is Microsoft's most expensive acquisition so far has also snatched Skype out of the hands of other potential suitors, which included Google and Facebook.

The combination will extend Skype's reach of its networked platform, while enhancing Microsoft's existing portfolio of real-time communications products and services.

Skype will support Microsoft devices like Xbox and Kinect, Windows Phone and a wide array of Windows devices, and Microsoft will connect Skype users with Lync, Outlook, Xbox Live and other communities. Microsoft will continue to invest in and support Skype clients on non-Microsoft platforms.

The acquisition is subject to regulatory approvals and other customary closing conditions. The parties hope to obtain all required regulatory clearances during the course of this calendar year.