MicrosoftMicrosoft has reached a deal to acquire networking site LinkedIn for a hefty $26.2 billion — it’s now the largest acquisition in the company’s history. As Variety reports, the purchase of LinkedIn, which has some 433 million users worldwide, will give Microsoft entree into the social-networking realm and “provide Microsoft a new engine to push its Office productivity and collaboration software to biz customers, along with other services.” Under the terms of the deal, Microsoft will acquire LinkedIn for $196 per share in an all-cash transaction, about a 50% premium over LinkedIn’s closing price last Friday, inclusive of LinkedIn’s net cash. According to CNBC, “Shares of LinkedIn surged 47 percent after the announcement to near $193, while Microsoft’s stock was down 3.2 percent. Trading in Microsoft had been halted briefly for news pending before the announcement of the all-cash deal.”

LinkenInMicrosoft says LinkedIn will retain its existing brand and operate as an independent division. Jeff Weiner (right) will remain CEO of LinkedIn, reporting to Microsoft CEO Satya Nadella (left). “The LinkedIn team has grown a fantastic business centered on connecting the world’s professionals,” Nadella said in announcing the deal on Monday. “Together we can accelerate the growth of LinkedIn, as well as Microsoft Office 365 and Dynamics as we seek to empower every person and organization on the planet.” The deal, which has been approved by both companies’ boards, is expected to close by the end of 2016, subject to the usual regulatory approvals.

Microsoft’s biggest acquisitions until now had been Skype for $8.5 billion in 2011 and Nokia’s mobile devices business for $7.2 billion in 2014 — the Nokia deal is described by Variety as “a debacle, leading Microsoft to slash headcount in the Nokia division and write down most of the value of that deal.”