According to a report, Microsoft is planning to acquire a developer of private social networks for companies, Yammer Inc in a deal valued at more than $1 billion.

The report in the Wall Street Journal said that it was not confirmed if the deal will be completed or announced officially by the company. People closer to the matter said that Yammer Inc has agreed to the acquisition deal with the software giant.

Yammer, which is based in San Francisco did not comment on the report. The company was established in 2008 and provides enterprise social networking services. It has raised more than $142 million in venture capital funding.

Yammer develops social networks that help company's employees to communicate and collaborate in an easier way, much like Facebook works on a grand scale. The company says its social networks are used by more than 200,000 companies worldwide. It counts more than 80 percent of Fortune 500 companies among its clients and has PayPal co-founder Peter Thiel as one of its investors.

The rumors of a possible takeover started after a media publication reported that several people overheard acquisition talks at Yammer's offices.