Microsoft to Buy aQuantive for $6 Billion (Reuters)

By Eric Auchard

NEW YORK (Reuters) - Microsoft Corp. said on Friday it would buy aQuantive Inc. for about $6 billion, or $66.50 a share, an 85 percent premium to the online advertising company's closing price on Thursday.

Shares of aQuantive shot to $63.95 in pre-opening trade, following news of the deal.

The all-cash deal tops a dramatic one-month consolidation spree across the online advertising market sparked when Google Inc. agreed to buy DoubleClick for $3.1 billion.

Yahoo Inc. followed by snatching up the 80 percent of Right Media it did not already own in a deal valued at $680 million. This week, WPP Group said it would acquire 24/7 Real Media Inc. for $649 million. Ahead of the wave, French advertising giant Publicis bought online ad agency Digitas in December for $1.3 billion.

Microsoft of Redmond, Washington said it would acquire aQuantive, based in nearby Seattle, to expand its push into Internet advertising through aQuantive's tools for managing the buying and selling of online ads.

Shares of aQuantive closed at $35.87 on Thursday on the Nasdaq. ValueClick, the last sizable independent player in the online advertising market saw its shares jump as much as 12.5 percent in premarket trade to $31.36 from $27.88.

AQuantive helps advertisers target online ads through its Atlas technology unit and offers Web-site development services through its design agency Avenue A/Razorfish. It also operates an online advertising network that connects buyers and sellers and provides behavioral targeting for advertisers of Web site users.

Microsoft said the deal would allow it to strengthen ties with advertisers, ad agencies and Web site publishers by enhancing the underlying mix of software and services its MSN consumer Internet business unit can deliver.

The acquisition also provides Microsoft increased depth in building a new generation of advertising in markets such as video-on-demand and Internet Protocol Television, as well as cross-platform ad delivery, which bridges traditional and new media formats.

(Additional reporting by Ritsuko Ando in New York)