Facebook is buying a portion of patents from Microsoft for $550 million in cash, patents which Microsoft recently acquired from AOL, Microsoft and Facebook announced Monday.
Microsoft originally acquired rights to 925 U.S. patents and patent applications from AOL and a license to AOL's patent portfolio, which includes 300 additional patents that were not for sale, according to a press release from Microsoft .
Facebook, however, is buying about 650 of the AOL patents and patent applications from Microsoft and will have license to the AOL patents and applications that Microsoft will own.
"Today's agreement with Microsoft represents an important acquisition for Facebook," said Ted Ullyot, general counsel for Facebook in a press release. "This is another significant step in our ongoing process of building an intellectual property portfolio to protect Facebook's interests over the long term."
Facebook's acquisition of the patents comes as the company is preparing for its initial public offering, which is estimated to value the company at more than $100 billion.