Microsoft Corporation (MSFT) Wants To Buy GitHub

One of the most iconic moments in Microsoft Corporation (NASDAQ:MSFT) history was a 2000 conference in which then-CEO Steve Ballmer took the stage and made a fool of himself.

Screaming “Developers, developers, developers!” at the top of his lungs, Ballmer made himself one of the web’s earliest memes.

Eighteen years later, however, the software giant’s dedication to courting developers has perhaps never been stronger. And as CNBC reports, Microsoft is courting one of the most developer-focused companies on earth, GitHub:

One person familiar with the discussions between the companies told CNBC that they had been considering a joint marketing partnership valued around $35 million, and that those discussions had progressed to a possible investment or outright acquisition. It is unclear whether talks are still ongoing, but this person said that GitHub’s price for a full acquisition was more than Microsoft currently wanted to pay.

GitHub was last valued at $2 billion in its last funding round 2015, but the price tag for an acquisition could be $5 billion or more, based on a price that was floated last year.

GitHub boasts over 23 million users in over 1.5 million organizations. It’s on track to do about $200 million in subscription revenue this year — not a huge sum by Microsoft standards — but probably putting it close to breakeven.

It’s all about the developers anyway. If Microsoft can pull a coups and bring GitHub into the fold, 23 million developers around the world will suddenly be using a Microsoft product. That’s a big deal.

Microsoft Corporation shares rose $0.60 (+0.60%) in premarket trading Monday. Year-to-date, MSFT has gained 18.89%, versus a 2.94% rise in the benchmark S&P 500 index during the same period.

MSFT currently has a StockNews.com POWR Rating of A (Strong Buy), and is ranked #1 of 66 stocks in the Software – Application category.