Microsoft and Yammer have entered into a definitive agreement, under which Microsoft will acquire the enterprise social network provider for a cool $1.2 billion in cash. The Yammer team is to becomes part of Microsoft’s Office division, and will continue to develop its standalone service.

Microsoft CEO Steve Ballmer explained that his company’s latest acquisition underscores its commitment to delivering technology that companies need. According to Ballmer, Yammer will provide the Redmond-based software giant’s corporate users with the “best-in-class enterprise social networking service”. This service will serve to complement Microsoft’s other cloud-based services such as Office 365, and Skype.

Yammer was launched in 2008 and currently boasts over five million corporate users. Like Linkedin, this service enables users to join a secure, private social network free of charge.

“When we started Yammer four years ago, we set out to do something big,” stated David Sacks, Yammer CEO. “We had a vision for how social networking could change the way we work. Joining Microsoft will accelerate that vision and give us access to the technologies, expertise and resources we’ll need to scale and innovate.”

In related news, Microsoft recently previewed the forthcoming release of its smartphone platform, Windows Phone 8, and also unveiled two of its own Windows 8-based tablet devices named Surface.