Washington headquartered tech-giant Microsoft has agreed to acquire the San Francisco-based coding site GitHub for $7.5 billion. Both Microsoft and GitHub have been in talks in the past for a possible acquisition of the software development platform.
The coding company has been hunting for a CEO for the past nine months following former CEO and founder Chris Wanstrath’s resignation in August 2017, after the company reported $200 million in annual revenue. In 2015, GitHub raised $250 million in funding and the coding-giant was then valued at $2 billion.
GitHub has 80 million code repositories globally, 28 million developers and 1.8 billion businesses and organizations are on its platform. Many tech companies like Apple, Google, Amazon, SAP among others use GitHub. Microsoft, on the other hand, hosts its Windows File Manager source code on GitHub.
Under current CEO Satya Nadella—who came on board in 2014, after former CEO Steve Ballmer stepped down—Microsoft has expanded beyond its most popular product Windows. The company’s Android and iOS versions are doing well and are considered as good as Windows.
Nadella’s strategy to shift the company's focus to cloud computing has helped push the software giant’s shares up. On May 30, Microsoft’s share value went as high as 1% and stood at more than 15% in the year valuing the company at $760 billion, which was more than Google’s parent company Alphabet’s market cap of $745 billion.
An acquisition would benefit both the companies on a customer and product perspective. While GitHub, on the other hand, would get more stability following major overturn in its executive ranks since 2014.
Several reports had floated over the years and last year it was reported that Microsoft could buy GitHub for $5 billion. Microsoft has previously acquired LinkedIn for $26.2 billion in 2016 and Skype for $8.5 billion in cash in 2011.
Subject to completion of regulatory review an closing conditions, the acquisition is expected to close by the end of the year.