Yahoo’s next target of acquisition has been going around in the newsroom for a couple of days now and it seemed like it has its eyes set on the popular blogging site Tumblr. If the deal pushes through, it would be Yahoo’s biggest deal to date and perhaps something that would give CEO Marissa Mayer the much needed boost as she tries to revive the company’s glory by gaining younger customers.
The rumored deal was hinted at a special event held in New York City which was attended by the press after being invited by Yahoo. Though it wasn’t really expressed directly, the company seemed excited as they utter words about sharing something special real soon.
We must take note that Yahoo had been very active lately when it comes to gaining new acquisitions. Some of these include Astrid and Summly. However, those deals can never be categorized as huge. At this point, Yahoo has decided to make that big leap by turning its attention on acquiring Tumblr. The targeted deal is even described as something more expensive than the acquisition venture of Facebook on Instagram. The said deal was reported to have a total cost of $ 715 million both in cash and stock.
Ever since Yahoo had Marissa Mayer as its new CEO, both fans and critics alike have been very keen on keeping their eyes widely open as the company struggles to turn their fate around. Should the Tumblr deal be concluded, it will be the company’s biggest acquisition expenditure which could somehow compensate for some of those acquisition losses that occurred with Broadcast.com and Geocities. With an impressive record of web traffic and an envied social prominence, Tumblr seemed the most ideal solution in giving Yahoo its much needed relevance boost. However, it is not actually clear if the planned acquisition could also bring in huge revenue.
The buying bid is said to have a cost of $ 1.1 billion which is deemed by Tumblr as ‘too low.’ Nevertheless, it tries to be optimistic by describing the offer as an ‘initial’ fee. The company has also expressed its intention to market itself to other interested buyers if Yahoo’s offer is not good enough for their standards.
(source)