The software giant buys Norway's Fast to better compete with Google and IBM.
Microsoft made a big bet in enterprise search, agreeing to acquire Fast Search & Transfer ASA for $1.2 billion, a 42 percent premium over the Oslo, Norway, company's closing share price on Jan. 4.
The Redmond, Wash., software company said on Jan. 8 that Fast's board of directors has unanimously recommended that its shareholders accept the offer, which is expected to close in the second quarter of calendar year 2008.
Fast is a specialist in enterprise search, which consists of software and appliances that help corporate employees track down what they are looking for, typically behind the company firewall.
For example, employees of a large company could use enterprise search software to pinpoint a profile of a single staffer from a human resources database of thousands of employees.
Read more here about Microsoft introducing free enterprise search.
Jeff Raikes, president of the Microsoft Business Division, said in a statement that enterprise search is becoming an indispensable tool for businesses of all sizes.
"Until now organizations have been forced to choose between powerful, high-end search technologies or more mainstream, infrastructure solutions," Raikes said, taking a swipe at Microsoft rivals Google and IBM. "The combination of Microsoft and Fast gives customers a new choice: a single vendor with solutions that span the full range of customer needs."
Microsoft believes that adding Fast will help the company bolster its current enterprise search product line, which includes Search Server 2008 Express, Microsoft Search Server 2008 and Microsoft Office SharePoint Server 2007.
While less glamorous than its commercial brethren, consumer search, enterprise search is still pegged by analysts as a multibillion-dollar business with significant growth potential that has yet to scratch the surface.
Google and IBM are two of the larger vendors in the space, which also includes a handful of specialists, led by Autonomy and Fast, as well as Endeca, Vivisimo and Exalead.
Successfully acquiring Fast will give Microsoft a strong leadership position in the market, complementing the company's recently revamped Live Search