Microsoft is said to be in talks to acquire social networking site Yammer.
A report from Bloomberg cited source familiar with the matter in reporting that the Redmond software giant was prepared to shell out upwards of $1bn for the enterprise-focused social networking site.
According to the report, Yammer would be added to Microsoft's enterprise business and would be used to add social networking capabilities to the company's products.
Based out of London and San Francisco, Yammer offers social networking services for enterprise users. It is unclear how a possible acquisition by Microsoft could impact Yammer staff or its recently-constructed headquarters in Tech City.
A $1bn price tag would be roughly in line with what fellow enterprise social networking firm LinkedIn raised in its initial public offering last year.
Yammer itself recently made an acquisition, purchasing UK start-up oneDrum in April. The company hailed the deal as a turning point for its operations.
The social networking space has seen a great deal of consolidation in recent months. Big names such as Citrix and Salesforce.com have sought to boost their enterprise products with acquisitions of social networking specialists.
Microsoft's most recent foray into the social networking market was a $550m deal with Facebook which gave the social networking giant control over key patents related to its legal battle with Yahoo.