Microsoft announced a $1.2 billion takeover offer for Norwegian enterprise search company Fast Search and Transfer. FAST’s board of directors unanimously recommended that shareholders approve the deal, and 37% of the shareholders — including the company’s two largest institutional investors — have already irrevocably accepted the offer.

FAST has over 3500 enterprise clients, including heavyweights like Disney, The Washington Post,, and LexisNexis. According to Mary-Jo Foley, we should pay attention to how Microsoft will integrate FAST into their SharePoint Server. “Remember what Microsoft CEO Steve Ballmer said about SharePoint last year: He characterized SharePoint as the next big operating system from Microsoft,” she writes. “More and more, it’s looking like enterprise search functionality is one of the biggest reasons why.”

In a press release, Microsoft points out that the acquisition would also give the company increased presence in the European market, in addition to enhancing the enterprise search products.

Larry Dignan thinks this will lead the rest of the industry to consolidate the same way the advertising industry has been. “Until now organizations have been forced to choose between powerful, high-end search technologies or more mainstream, infrastructure solutions. The combination of Microsoft and FAST gives customers a new choice: a single vendor with solutions that span the full range of customer needs,” said Jeff Raikes, president of Microsoft’s Business Division. Sounds like Dignan might be right.