Rival Bidding Forced Microsoft to Raise Its Offer for LinkedIn

By Jay Greene 

Persistent bidding from a rival, likely Salesforce.com Inc., forced Microsoft Corp. to boost its offer for LinkedIn Corp. by 22%, or roughly $5 billion, during the two months of negotiations, according to a regulatory filing by the professional social network.

The software giant ultimately agreed to buy LinkedIn last month for $26.2 billion, or $196 a share in cash. That was a 50% premium over LinkedIn's stock price before the deal's announcement.

A Securities and Exchange Commission filing by LinkedIn on Friday disclosed that Microsoft submitted on May 4 a nonbinding indication of interest to acquire LinkedIn at $160 a share in cash. Nine days earlier, another company, described by LinkedIn as "Party A," submitted its own nonbinding indication of interest to buy the company for $160 to $165 a share in a mix of cash and stock.

The Wall Street Journal and other publications previously reported Salesforce was the second bidder for LinkedIn.

The bid from Salesforce put pressure on Microsoft to boost its offer several times. Even after LinkedIn entered an arrangement to negotiate with Microsoft exclusively, Salesforce persisted on pushing its bid. And as its stock price climbed, the value of its offer grew as well, leading LinkedIn executives to press Microsoft for more money.

Microsoft, LinkedIn and Salesforce declined to comment.

Write to Jay Greene at [e-mail]

(END) Dow Jones Newswires

July 01, 2016 20:10 ET (00:10 GMT)

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