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Yahoo! to Acquire Inktomi

Yahoo! to Acquire Inktomi

Yahoo! Inc and Inktomi Corp. announced they have signed a definitive agreement under which Yahoo! will acquire Inktomi for a purchase price of $1.65 per share in cash.

The transaction reflects an aggregate purchase price of approximately $235 million, adjusted for Inktomi's expected cash balance net of debt, as of December 31, 2002.

"Yahoo!'s vast reach and its unmatched breadth and depth of services, combined with Inktomi's outstanding engineering expertise and leading search technology, will help us achieve our goal of providing users with the most comprehensive, relevant and highest quality search solutions on the Web," said Terry Semel, Yahoo! chairman and CEO.

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"The addition of Inktomi's search platform adds both control and flexibility to this important business, thus enhancing our ability to create new and more innovative search offerings for consumers and businesses."

"Since 1996, Inktomi's foundation has been the Web search business and we have grown it significantly with our core customers and new paid inclusion partners while focusing on extending and innovating our technology," said David Peterschmidt, Inktomi chairman and CEO. "Today's announcement matches our premier Web search technology and team with Yahoo!'s global reach and commitment to providing the best user experience on the Web, bringing us closer to achieving our mutual goal of making the Inktomi-Yahoo! search offering the standard bearer for searching on the Web."

The transaction is subject to customary closing conditions, including regulatory approval and the approval of Inktomi's stockholders.

The transaction is expected to be completed in the first quarter of 2003. Yahoo! expects the transaction to be accretive to earnings per share within 12 months of closing.

Inktomi, recently focused its assets exclusively on the growing Web Search space.

The company also has made significant improvements in its overall Web search capability, including increased relevance, a fresher and larger index, paid inclusion, the utilization of an XML interface and features targeted at understanding user intent for interactions on the Web.

Yahoo! is committed to being a leader in search and Yahoo! Search has seen continued growth in number of users, user retention, number of searches and click-through rates since its recent search improvements this past October, making Yahoo! Search results more comprehensive and relevant than ever before.

Yahoo! has introduced a series of enhancements to its search business in recent months, including:

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