Most people are aware Yahoo! Inc. (NASDAQ:YHOO) has been on a buying spree over the last year or so, having made more than two dozen acquisitions since the arrival of new CEO Marissa Mayer in July of 2012. What is somewhat surprising, however, is the high price that Yahoo is willing to pay for some of the companies they are acquiring.
Yahoo! Inc. (NASDAQ:YHOO)'s acquisition of the start up Aviate was announced earlier this week at the CES, but the terms of the deal were not released. Aviate develops software that allows contextually relevant information to be displayed on Android device home screens, and had just completed a $1.8 million Series A financing put together by a group including Andreesson Horowitz and Highland Capital.
Source close to deal says Yahoo paid $80 million for Aviate
Anthony Ha of Tech Crunch reports that a source close to the Aviate deal has confirmed that the final price was $80 million. This seems staggeringly high for a startup that just closed a $1.8 million Series A financing. An initial rumor that Yahoo! Inc. (NASDAQ:YHOO) paid $20 million for Aviate has been floating around since the announcement, and a few analysts had commented that seemed like a relatively generous valuation. If it turns out Yahoo! Inc. (NASDAQ:YHOO) really did pay $80 million for Aviate, that speaks volumes as to how much Yahoo wanted Aviate technology and personnel, as well as to Yahoo's commitment to the Android ecosphere. An $80 million price tag for the company would also reflect well on the negotiating skills of Aviate management.
Other recent Yahoo acquisitions
New CEO Marissa Mayer is clearly trying to rebrand Yahoo as more than your parent's Internet. Yahoo! Inc. (NASDAQ:YHOO) acquired 24 companies in calendar year 2013, including Tumblr ($1.1 billion deal) and PeerCDN, and if the Aviate deal is any indicator, they are apparently planning to continue to spend to get what they want in 2014. The acquisition-happy Internet giant is also reportedly in negotiations to purchase the Image-sharing concern Imgur.