Five companies considered acquiring LinkedIn

02 Jul 2016

A new SEC filing posted yesterday offered more clarity about the circumstances around Microsoft's acquisition of LinkedIn for over $26 billion. It also points out that Microsoft was not the only prospective buyer (See: Microsoft to acquire LinkedIn for $26.2 bn in cash ).

According to the filing, the talks between LinkedIn CEO Jeff Weiner and Microsoft CEO Satya Nadella got underway on 16 February of this year, only 12 days ahead of an earnings debacle in which LinkedIn shares plummeted.

It also referenced, not one, but four other unnamed companies and detailed LinkedIn's conversations with them.

It had already been reported that Salesforce had made a bid for LinkedIn. The documents refered to a Party A, likely Salesforce, that ultimately bid $200 per share, above the $196 per share in cash that Microsoft paid. However the $200 was a cash and stock deal, while the $196 was an all cash deal. This worked out to hundreds of millions of dollars deducted from the acquisition price.

The filing also contained details about the conversations with at least three other companies, who ultimately withdrew. It was not clear as to whether the other bidders intended to contend in good faith or whether they were only interested in getting a detailed look at LinkedIn's financial picture and competitive strategies.

According to Bloomberg's report last month, Salesforce was a rival bidder for LinkedIn, which Salesforce.com chief executive Marc Benioff later acknowledged.

The filing further revealed that two bidders together made nine offers for the professional social-networking company, and that LinkedIn took steps to assess  the interest of three other firms.

Party A had, in an initial bid in April valued LinkedIn at $160. However, at the time of LinkedIn's final approval to a sale two months later, the winning bid increased 22 per cent to Microsoft's all-cash, $196 a share offer.