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Microsoft Dials In Skype For $8.5B

5/10/2011 09:16:35 AM Eastern

Redmond, Wash. - Microsoft
announced today it will acquire Skype for $8.5 billion in cash.

The deal is already approved by Microsoft's and Silver Lake's
board of directors. Silver Lake is the investment firm that owns Skype. Skype
will become a new Microsoft business division called Microsoft Skype Division
which will be headed by Skype CEO Tony Bates. He will report directly to
Microsoft CEO Steve Ballmer.

Microsoft said Skype will support Xbox, Kinect, Windows phone and
other Windows applications.

Skype was founded in 2003 and purchased two years later by eBay,
which sold Skype to Silver Lake in November 2009. Skype has 170 million users
and handled 207 billion minutes of voice and video communication in 2010, the
company said.

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