Microsoft is Ready to Call on Skype

“Skype is now part of Microsoft,” screams the software behemoth on its website. It has closed its acquisition of Skype, an Internet communications company. Microsoft announced today, Oct. 14.

Negotiations of the definitive agreement under which Microsoft would acquire Skype for $8.5 billion were led by investor group Silver Lake and the transaction was originally announced on May 10, 2011. Boards of directors of both Microsoft and Skype previously approved the acquisition.

[ Also Read: Hello, Microsoft Going to Acquire Skype ]

Microsoft and Skype will remain focused on their shared goal of connecting all people across all devices and accelerating both companies’ efforts to transform real-time communications for consumers and enterprise customers. The completion of the acquisition also marks the official introduction of Skype as a new business division within Microsoft.

“Skype is a phenomenal product and brand that is loved by hundreds of millions of people around the world,” said Microsoft CEO Steve Ballmer. “We look forward to working with the Skype team to create new ways for people to stay connected to family, friends, clients and colleagues — anytime, anywhere.”

[ Also Read: Skype Video Calling App for iPad Users ]

Skype CEO Tony Bates will assume the title of president of the Skype Division of Microsoft immediately, reporting directly to Ballmer. The Skype division will continue to offer its current products to users globally.

Longer term, Skype will also be integrated across an array of Microsoft products to broaden Skype’s reach and accelerate its growth as a fundamental way people communicate online.

Skype employees will continue to be located around the world in offices including Estonia, the Czech Republic, Russia, Sweden, the United Kingdom, Luxembourg, Japan, Singapore, Hong Kong, and the United States.

[ Also Read: Video Conferencing App for iPad2, iPhone ]

“By bringing together the best of Microsoft and the best of Skype, we are committed to empowering consumers and businesses around the globe to connect in new ways,” Bates said. “Together, we will be able to accelerate Skype’s goal to reach 1 billion users daily,” Bates said.

Founded in 2003, Skype was acquired by eBay in September 2005, and then acquired by an investment group led by Silver Lake in November 2009.

Other members of the selling investor group led by Silver Lake include eBay International AG, CPP Investment Board, Joltid Ltd. in partnership with Europlay Capital Advisors; and Andreessen Horowitz.

Photo courtesy: Skype

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Rakesh Raman