Microsoft acquires minority stake in Facebook

Microsoft had it up its sleeve on how to overcome the intense rivalry over online advertising with Google and Yahoo.  Microsoft went ahead with a deal with Facebook, the social-networking business and acquired a minority stake in Facebook.  Microsoft announced that it will pay $240 million for a 1.6% stake in Facebook, a 3-year old company based in Palo Alto.

Microsoft secured U.S. rights to sell banner ads and sponsered links on Facebook in August 2006.  This new deal between Microsoft and Facebook will expand the agreement, hopefully allowing Microsoft to thrive in the online advertising business.

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