Three former close associates testified as prosecution witnesses that Bankman-Fried had directed them to use FTX customer funds to plug losses at Alameda Research
The deal is combining the software giant's fast-growing cloud services business with the world's largest online network for professionals.
The offer of $196 per share represents a premium of 49.5 percent to LinkedIn's Friday closing price.
LinkedIn's shares were jumped 48 percent to $194.28 before the opening bell on Monday. Microsoft's shares were down 3.3 percent.
"Today is a re-founding moment for LinkedIn," Reid Hoffman, chairman of LinkedIn's board, said in a statement.
Jeff Weiner will remain chief executive of LinkedIn, reporting to Microsoft CEO Satya Nadella.