Yahoo! Inc. is buying video-advertising service BrightRoll Inc. for about US$640 million in cash, seeking to boost marketing tools amid a turnaround effort by Chief Executive Officer Marissa Mayer. BrightRoll, which would be one of Yahoo's biggest acquisitions under Mayer, is profitable and should exceed more than US$100 million in revenue this year, the Web portal said today in a statement. Yahoo expects the deal, which is subject to customary closing conditions, to boost earnings before interest, taxes, depreciation and amortization. "Video, along with mobile, social, and native, is driving a surge in digital advertising," Mayer said in the statement. "BrightRoll is a terrific, strategic and financially compelling fit for our video advertising business." Mayer has faced criticism for her acquisitions, including most recently from activist investor Starboard Value LP. In September, Starboard questioned Mayer's leadership and called for a breakup of the Sunnyvale, California-based company, in order to unlock more shareholder value. Starboard also asked that Yahoo cease from more dealmaking and cut costs. On a conference call last month, Mayer said the deals have helped boost Yahoo's user growth. The company's total user base, including blogging platform Tumble, has expanded to more than 1 billion and mobile users are at about 550 million, she said. Yahoo bought Tumbler last year for about US$1 billion. Source: Financial Post
