(CNNMoney) -- Is corporate America ready to adopt social networking alongside traditional office tools like word processing apps and spreadsheets?
Microsoft is making a big bet in that direction. It has acquired Yammer, an "enterprise social networking" startup, for $1.2 billion in cash. The deal is Microsoft's (MSFT, Fortune 500) biggest acquisition since Skype.
Yammer operates like a gated Facebook (FB): A business can set up a private network where employees can post announcements, share files, create events, swap messages and more. It also offers more traditional corporate features like a content management system and an "extranet" that businesses can use to communicate with outside contacts like customers and vendors.
Buying Yammer "underscores our commitment to deliver technology that businesses need and people love," Microsoft CEO Steve Ballmer said in a prepared statement.
Yammer, which was founded in 2008, had raised about $142 million in venture funding. It claims more than 5 million corporate users, including 80% of the Fortune 500 list.more