Yahoo! Buys Marketing Firm

Search engine supersite Yahoo! said Monday that it's buying direct marketer Yoyodyne for stock deal valued at about $30 million.

Yahoo! will issue 280,664 shares of its common stock for all outstanding Yoyodyne shares, options and warrants.

Yahoo! plans to take a $2 million charge in the fourth quarter for costs related to the deal.

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Shares of Yahoo! (YHOO) rose 10 3/16 to 1115 13/16 Monday afternoon amid a technology stock rebound.

In a press release, the companies said Yoyodyne's direct marketing services will be integrated into Yahoo!'s advertising and merchant services.

"Yoyodyne provides several key elements Yahoo! seeks in extending its business, including the most talented team in the industry; a proven business model, client and user base; and a solid track record," Yahoo! CEO Tim Koogle said in a statement.

Yoyodyne generates sales leads through direct mail, e-mail, and web site offers for free prizes. The company also keeps a database of such leads. Yahoo! will integrate the techniques with its own merchandising programs.

Yoyodyne's services include, which directs web surfers to name brand online shopping sites and, which directs surfers to sponsors.

Other services include, a promotion targeted at entrepreneurs and small businesses; and, a site to linke up car buyers with car manufacturers.

The acquisition, which will be accounted for as a pooling of interests, is expected to be completed in the fourth quarter.

Written By Steve Gelsi, CBS MarketWatch