Yahoo’s board of directors approved an offer to buy the ailing Tumblr company for $1.1 billion in cash.
Tumblr has yet to agree to the deal, various media reported. But the acquisition could be made official as early as Monday, the San Francisco Chronicle reported. Yahoo has scheduled a press conference in New York City, the location of Tumblr headquarters. And one media outlet — The New York Post — has reported the deal as done, saying Tumblr founder David Karp is on board with the cash prospect.
The purchase is aimed at making Yahoo relevant to the younger crowd and go head-to-head with Google, Facebook and Twitter, the Chronicle said. It’s a bold move for Yahoo’s Chief Executive Officer Marissa Mayer, who just took the helm at the company last year.
“[Yahoo has] wanted something that has Facebook- and Twitter-like features for many years,” said Ross Rubin, founder and principal analyst at Reticle Research in New York, in the Chronicle story. “This would allow it to have a way to build a community again, to create an alternative to Facebook and Twitter that doesn’t need to start from scratch the way Google+ is trying to do.”
Tumblr had been struggling to generate revenue from ads for some time, The Post reported.
The site has more than 100 million blogs, but only raked in about $15 million in ad revenue last year, The Post said.
• Cheryl K. Chumley can be reached at cchumley@washingtontimes.com.
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