Microsoft has brought the business social network and communications tool Yammer for $1.2bn.
The social network is four years old and has around five million users.
It helps businesses create private social networks for its employees to communicate and share documents more effectively than email.
It is already used by companies including Ford, Shell, O2 and Unicef.
"When Adam Pisoni and I started Yammer, we set out to do something big," said Yammer CEO David Sacks on the website's blog.
"When most people thought social networking was for kids, we had a vision for how it could change the way we work. Four years ago, we started paddling out to catch the wave that we’re riding today."
Sacks said Yammer will be integrated into other Microsoft products, including Office and Skype.
"With the backing of Microsoft, our aim is to massively accelerate our vision to change the way work gets done with software that is built for the enterprise and loved by users," he said.
Microsoft said the purchase would bolster its communications suite and enhance its offering to enterprise customers.
"The acquisition of Yammer underscores our commitment to deliver technology that businesses need and people love," said Steve Ballmer, CEO, Microsoft.
"Yammer adds a best-in-class enterprise social networking service to Microsoft’s growing portfolio of complementary cloud services."