Under the deal, LinkedIn chief executive Jeff Weiner will remain in his post, reporting to Microsoft boss Satya Nadella.
The takeover comes as LinkedIn said its number of members has risen 19 per cent over the past year to 433 million, with 105 million unique vists a month to its website.
Nadella said: “The LinkedIn team has grown a fantastic business centered on connecting the world’s professionals. Together we can accelerate the growth of LinkedIn, as well as Microsoft Office 365 and Dynamics as we seek to empower every person and organisation on the planet.”
Weiner added: “Just as we have changed the way the world connects to opportunity, this relationship with Microsoft, and the combination of their cloud and LinkedIn’s network, now gives us a chance to also change the way the world works.
“For the last 13 years, we’ve been uniquely positioned to connect professionals to make them more productive and successful, and I’m looking forward to leading our team through the next chapter of our story.”
Microsoft said the deal, which values LinkedIn at $196 per share, is expected to complete before the end of the year, subject to approval by regulators and the social network’s shareholders.
Reid Hoffman, LinkedIn’s chairman, co-founder and controlling shareholder, said: “I see incredible opportunity for our members and customers and look forward to supporting this new and combined business.
“I fully support this transaction and the board’s decision to pursue it, and will vote my shares in accordance with their recommendation on it.”