Microsoft Buys Skype for $8.5 Billion. Why, Exactly?
Just days after reports that Google and Facebook were interested in partnering with, and possibly buying VoIP company Skype, Microsoft announced that it was buying the company for $8.56 billion in cash.
Last year, Skype had revenue of $860 million on which it posted an operating profit of $264 million. However, it overall made a small loss, of $7 million, and had long-term debt of $686 million. It was the second time Skype has been bought out; after being started in 2003, it was purchasd by eBay in 2005 for $3.1 billion. eBay then sold the majority of its stake in 2009 to a private investment group for $1.2 billion less than it paid.