Microsoft will acquire LinkedIn Corp. in an all-cash deal valued at $26.2 billion. LinkedIn will continue to operate as an independent subsidiary, with CEO Jeff Weiner (above right) reporting to Microsoft CEO Satya Nadella (above left). The deal has the unanimous support of both boards of directors, Microsoft said in a press release. It’s expected to close before the end of the year.

Founded in 2002, LinkedIn has built the world’s largest professional network, with more than 433 million members worldwide. It logs 105 million unique visitors per month and 45 billion quarterly page views, Microsoft said.

Microsoft will finance the transaction primarily through the issuance of new debt. It will report LinkedIn’s financials as part of Microsoft’s Productivity and Business Processes segment, which includes the Office 365 suite of cloud-based productivity tools and the Dynamics platforms for enterprise resource planning and customer relationship management (CRM).

“I have always had a great admiration for LinkedIn,” Nadella said in a video interview. “I’m a user on LinkedIn and a publisher on LinkedIn. I’m a great believer in productivity and communication tools. Think about taking that and connecting it with a professional network and having the entirety of your professional life being enhanced. I’ve been thinking about this for a long time.”

LinkedIn shares have been beaten down in recent months as the result of a disappointing fourth-quarter earnings report that sent shares down 45 percent in a single week early this year. The stock has struggled back somewhat on upbeat first-quarter 2016 earnings, but it’s still less than half of the $269 peak reached in February, 2015.

In a letter to employees, Nadella said the deal clicks on all levels. “This combination will make it possible for new experiences such as a LinkedIn newsfeed that serves up articles based on the project you are working on and Office suggesting an expert to connect with via LinkedIn to help with a task you’re trying to complete,” he wrote.

LinkedIn dovetails nicely with Microsoft’s efforts to position its Office 365 and Dynamics platforms as immersive productivity suites, Nadella wrote. “We can reinvent ways to make professionals more productive while at the same time reinventing selling, marketing and talent management business processes,” he wrote.

The deal appears to have competitive implications for Salesforce.com Inc., the leading CRM platform. LinkedIn jealously guards the data it has collected about its members, refusing to license the database to CRM companies. Having access to that data gives Microsoft a significant leg up on its CRM competitors, although it will have to tread carefully to avoid violating the trust LinkedIn has built through selective disclosure of member information.

A conference call is scheduled for 11:45 EDT this morning. We’ll let you know more information as we get it.

Photo via Microsoft