Why Google is going all in on #GoogleIAm
Google Inc. said on Thursday it is launching an all-in bid to acquire rival Yahoo Inc., the latest move in a global search arms race.
The search giant plans to buy Yahoo for about $4.5 billion and has been aggressively searching for a buyer in recent weeks.
Yahoo has struggled to compete in the increasingly crowded and lucrative search market in recent years and is under pressure from Google and other internet giants.
The deal is expected to close in the first quarter of 2019.
In a blog post, the company said it has a “long history of developing and delivering the best search experiences in the industry” and that it is “a strong leader in the global online advertising market” and “one of the leading providers of personalized search results.”
“We’re excited to join forces with Google and the Yahoo team to build an even more powerful and trusted digital presence for our customers and advertisers,” the company wrote.
“We are committed to building a world-class brand that is powered by Google’s powerful search engine, and we’re grateful to Yahoo for its longstanding support of the brand.”
The search giant also plans to offer more targeted ads on Yahoo.
Google said it will use its newly acquired equity to buy a majority stake in Yahoo.
The investment would give Google control of Yahoo’s businesses, including search, advertising, search results, content, mobile and other businesses.
“Our investment in Yahoo is the first step toward creating a new Yahoo,” Google’s co-founder Sergey Brin said in a blog posting.
“Yahoo’s success and our vision for the future are a great match.”
Yahoos shares were down 2.6% at $50.79 in after-hours trading.
At $40.77, Yahoo’s market value was about the same as that of Alphabet Inc., Google’s parent company.
The deal comes after Yahoo announced in January that it would close its AOL division after nearly 15 years in business, but it was unclear whether the move would force Yahoo to close the business or continue to operate as an independent company.
Earlier this year, Yahoo said it would lay off about 2,000 employees and close its Yahoo Mail business.
It is also working with Amazon Web Services Inc. to acquire Amazon WebPets, which it said would create a cloud-based service that would be a natural fit for Yahoo Mail, Yahoo Mail.com and other parts of its business.