Microsoft is acquiring Delaware’s largest software developer, Delaware Tax and Revenue Services, for $6 billion.
The acquisition, announced Thursday, comes as the state is under scrutiny by federal officials over its tax practices.
Microsoft’s Delaware deal follows its recent purchase of the Delaware Taxpayer Assistance Program, which allows taxpayers to file their taxes online, and its recent acquisition of Delaware’s state lottery program, which offers an online lottery drawing.
Delaware has also made moves to modernize its tax system and improve its online tax filing capabilities.
The deal also includes an additional $1 billion to be raised through a special dividend.
Microsoft said the acquisition of the software developer will help Delaware achieve the same goals as its larger, $30 billion deal for Delaware tax software in June.
The company said the Delaware deal is expected to close in the first half of 2019.
Microsoft’s deal is a direct investment in Delaware, where it plans to open a new research and development center, a state-of-the-art corporate headquarters, and create a new corporate offices and training center in the state.
The Delaware deal, however, is not linked to Microsoft’s tax software, which is based in Redmond, Washington.
“Delaware is a great state and we are excited to partner with Microsoft on this important project to create a tax software platform that will make tax filing easier and more efficient,” Gov.
Kathy Hochul, a Democrat, said in a statement.
“Delaware will be a strong partner for Microsoft in helping us improve the state’s tax system.”
Microsoft is expected pay Delaware $2.1 billion in cash and stock, with the remainder to be paid over a 10-year term.
Microsoft will retain a 5 percent stake in Delaware Tax Service and an option to buy out the remaining shares.
