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Microsoft Corporation (NASDAQ:MSFT) has agreed to purchase Yammer, a social media website used for businesses, for $1.2bn, said a person familiar with the deal.

According to this person, the company is set to announce the acquisition in late June. Dee Anna McPherson, a spokesperson for Yammer, and Frank Shaw, a spokesperson for Microsoft, both declined to comment on the deal.

Yammer, a company launched in 2008, is a social networking website that is used by businesses to connect employees and share ideas, projects, and allow for project collaboration. This acquisition helps to give validation to the idea that businesses are trying to integrate new ways of doing business into the day-to-day of their employees.

Small companies like Yammer have seen a jump in popularity and stock prices in recent years. Although not as popular as sites like Facebook or Twitter, Microsoft could use this kind of social media to incorporate into its business profile. Many larger corporations are acquiring smaller projects even before they reach an initial public offering.

The deal follows recent mergers with other social media based software– Salesforce.com, inc. (NYSE:CRM) gained access to social media tools through the $745million purchase of Buddy Media Inc., and Oracle Corp purchased two data analysis companies that focus on social media sites: Virtue Inc. and Collective Intent Inc.

Yammer was started in 2008 by the former Chief Operating Officer of PayPal Inc., David Sacks. The company has recently raised over $140million after a fundraising campaign. The software is used by many large corporations, including Ford Motor Co., and Ebay Inc, bringing the company to over 4million corporate users.

The office division of Microsoft currently creates about half of the company’s income and will to incorporate the social media into their lineup. The company’s stock has increased 16% this year and in the nine months ending on March 31, Microsoft reported revenue topping at $17.7bn, up 6.4% from the year-ago period.