Another acquisition for Yahoo

The company bought Bread, a URL-shortening website, only to shut it down.

By Benzinga Oct 14, 2013 9:32AM

Yahoo CEO Marissa Mayer (© Pascal Lauener/Reuters)By Tim Parker

 

If you can't beat them, buy them. It's been the way of the corporate giants for ages. A big company swallows up a smaller one as it gains momentum and looks to present a formidable threat to the larger Goliath.

 

Yahoo (YHOO) announced that it was acquiring Bread, a URL shortener that allowed users to place an advertisement in the click stream. Users would click the shortened link, see an ad for five seconds, and then be redirected to their destination.

 

What did Yahoo plan to do with the company? Shut it down. In fact, it already has. In a goodbye note on its website, Bread CEO Alan Chan wrote, "When we launched Bread in 2011, our goal was to help social media influencers and publishers better monetize their online content." The company announced that it would continue supporting Bread links until Nov.11 but advised users to switch links to bit.ly.

 

Bread's six employees will go to work for Yahoo. In a statement, Yahoo confirmed the acquisition. "We have acquired Bread, a company that created a simple way for social media influencers and publishers to monetize their content. The team's focus on delivering creative and targeted advertising across social media, desktop and mobile devices aligns perfectly with our mission to delight and inspire users."

 

Terms of the acquisition were unknown.

 

Bread is one of the many acquisitions made by Mayer this year. In May, Yahoo acquired Tumblr for $1.1 billion and made a promise not to screw it up. In addition, there were 18 other acquisitions including IQ Engines, Rockmelt, Lexity, Qwiki with a $50 million price tag, CRM company Xobni for $40 million, and Summly for $30 million.

 

Although Yahoo's track record for acquisitions is mixed over the years, one has paid off quite well. The company purchased a 40 percent stake in Alibaba, China's largest e-commerce company in 2005 for $1 billion. It now owns about 24 percent of the company.

 

Alibaba is planning an upcoming IPO that could value the company as high as $15 billion according to Reuters but the offering has reportedly been held up as the company ran into regulatory issues with the Hong Kong stock exchange where it had planned to list.

 

Regardless, this will likely be the most lucrative of all of Yahoo's acquisitions, even if it’s only a minority stake.

 

Disclosure: At the time of this writing, Tim Parker had no position in the above-mention stock.

 

Read more from Benzinga

100Comments
Oct 14, 2013 2:06PM
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Corporate greed, IPO's and mergers and acquisitions are the deterrents to a good economy.  Big business does not create jobs it only reduces the number of jobs available.  Until we once again regain a healthy small business environment and more manufacturing in the US there is no way to create additional jobs. 
Oct 14, 2013 4:58PM
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I know what i am sick of...Ads,Billboards,Political Signs and the likes..I dont read them any more and dont care to.. They have advertise us all to death!
Oct 14, 2013 2:55PM
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$1.1 billion acquisition for a website that 99% of users have never heard of.
Oct 14, 2013 8:28PM
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Yahoo, please buy Washington, DC and shut it down!!!!!!!!!!! Thank you!
Oct 14, 2013 2:19PM
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Company's are always buying out other company's these days, if the other company will sell.  I have seen this in smaller independent pharmacy/drug stores.  I like the older ones where they sold multiple items, were very customer oriented, and had a soda/sandwich counter (old-fashioned one).  Only to be bought out by larger well-know ones.  Better to acquire it and use it, than wipe it out.
Oct 14, 2013 8:18PM
Oct 14, 2013 2:45PM
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Hmmm well I gave up MSN, Gave up Comcast, Gave up AOL, ventured over to Huffington (that was an eye opener) sewage of America. So Yahoo is all I had left so now I have to give this up? Seems like the time to start a new social web page to me. 
Oct 14, 2013 3:28PM
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Hope the Bread guys got a lot of bread for their startup, otherwise they may regret the sale later on.
Oct 14, 2013 5:43PM
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Buying is the only thing yahoo can do now.  It's only profit came from it's alibaba stock. The company itself is in shambles and this CEO doesn't have the answers.
Oct 14, 2013 2:54PM
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Yahoo helping its pocket book not it's followers.  Oh the Shame
Oct 14, 2013 6:18PM
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the thing is ,, this lady has screwed yahoo up ,, bad . and their so out of touch they don't know it . I barely use yahoo anymore , had enough with the site changes , hurts my eyes and not user friendly like it once had been .
Oct 14, 2013 5:50PM
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What's the big deal here? Business has operated this way since the industrial revolution. If you can't beat your competition, buy em. Sometimes the gov't gets involved with anti trust law suits, but otherwise business as usual.
Oct 14, 2013 7:19PM
Oct 14, 2013 6:47PM
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I never understood URL shortening websites.  Is copy and paste that hard?
Oct 14, 2013 2:38PM
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This just goes to show what would happen without regulation. 
Oct 14, 2013 6:31PM
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More adds? Not delighted! Inspired to never use yahoo!!!!

Oct 14, 2013 9:52PM
Oct 14, 2013 4:38PM
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"no position in the above-mention stock" - great editing as usual!
Oct 15, 2013 1:10AM
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The Food Chain,

 

And so it goes...In business, the big fish dine on the little fish ... ad infinitum.

 

Peace to all ~

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