Microsoft will purchase VoIP service juggernaut Skype for $8.5 billion in a deal to be officially announce Tuesday morning. The all-cash deal will make Microsoft a powerful player in Internet-based voice and video communications overnight. Microsoft issued a press release Tuesday morning making the rumored acquisition official.
Previous reports suggested the purchase price would be somewhere between $7 billion and $8 billion. Skype has been on sale for a while now, and a number of companies reportedly showed interest in purchasing the Web-based phone and video chat service, including Facebook, Google, and Cisco.
The $8.5 billion purchase is Microsoft's largest acquisition in nearly three decades. Until now, Microsoft's most expensive acquisition was its 2007 purchase of digital marketing services agency aQuantive for $6 billion.
Despite Skype's having a debt of $686 million, the deal should be a plus for Microsoft. After all, Microsoft will finally have a brand-name Web service under its wing, though it's believed Microsoft plans to integrate Skype into Microsoft Live.
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