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Acquisition

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Definition

Acquisition of technology and knowledge involves

the purchase of external knowledge and technology

without active co operation with the source. This

external knowledge can be embodied in machinery

or equipment that incorporates this knowledge.

It can also include the hiring of employees who possess

the new knowledge, or the use of contract research

and consulting services. Disembodied technology or

knowledge also includes other know-how, patents,

licenses, trademarks and software.

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Benefits of Acquisition

Cross border acquisitions are effective in boosting Foreign Direct

Investment (FDI)

International acquisitions provide access to infrastructure and

customer base in a country which is quite difficult to build from

the scratch

An existing brand name in a country provides strong business

edge

Provides access to the Local Market

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Microsoft

Microsoft Corporationis an

American multinational software corporation

headquartered in Redmond, Washington thatdevelops, manufactures, licenses, and supports

a wide range of products and services related

to computing.

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Skype

Skypeis a freemium voice-over-IP serviceand instant messaging client

Skype was first released in August 2003

The service allows users to communicate with

peers by voice using a microphone, video byusing a webcam, and instant messaging over

the Internet

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Effect of Acquisition

The acquisition will increase the accessibility of

real-time video and voice communications, bringing

benefits to both consumers and enterprise users

and generating significant new business andrevenue opportunities. The combination will extend

Skypes world-class brand and the reach of its

networked platform, while enhancing Microsoftsexisting portfolio of real-time communications

products and services

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Why Microsoft Acquired It !!

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The following elements influence the international acquisitions

from many aspects:

Corporate governance

Company acts

The capacity of average workers

Political features of a country

Tradition and culture of a country

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Overview of SKYPE Acquisition

On May 10, 2011, Microsoft announced its acquisitionof Skype Technologies, creator of the VoIP service Skype, for

$8.5 billion

With a value 32 times larger than Skype's operating profits, thedeal was Microsoft's largest acquisition ever

Skype would become a division within Microsoft, with

Skype's former CEO Tony Bates now its president reporting toMicrosoft CEO Steve Ballmer

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Acquiree

Skype

Acquirer

Microsoft

Sector

Mobile/Wireless

Acquiree Country

United States

Acquisition Date

May 11, 2011

Used As/Integrated

With

Peer-to-Peer

Chat

Acquiree Website

skype.com

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