Internet search giant Yahoo! has bought Maktoob.com, the company behind the largest Arab online community, in a bid to strengthen its presence in the region.
The online search and entertainment giant said it was thrilled to announce the acquisition, announced at a press conference on Tuesday.
Much speculation surrounds the value of the transaction, which one Arab website has estimated to be worth $100m, but the official amount and deal terms have not yet been disclosed.
Maktoob said it expects the acquisition to complete in the fourth quarter.
The move represents Yahoo!’s first major step into the region. The search giant has 20 million users in the Middle East despite no Arabic service.
Keith Nilsson, vice president of emerging market, Yahoo!, said Yahoo! products will now become available to users in the Middle East, starting with email in Arabic. All products will be co-branded, the firm said.
Yahoo! made assurances it was aware of local sensitivities and laws and would maintain Maktoob's editorial policy.
Samih Toukan, co-founder of Maktoob, said the synergies between the companies were enormous. "Yahoo! investments in coming years will energise Maktoob and make it grow further," he said.
Maktoob research, its portal and online community will be part of Yahoo!. Four units of Maktoob - souq.com, cashu.com, araby.com and tahadi.com - will not be part of the deal. They will be operated by a new company called Jabbar Internet Group, which will be managed by Toukan.
Jordan-based Maktoob was founded in 2000.
In 2005 private equity group Abraaj Capital bought a 40 percent stake in the company for $5.2m, which it sold to Tiger Global Management in 2007, generating an internal rate of return of 75 percent.
In addition to its social networking community, the company’s services include an Arabic-language auction facility, the first Arabic-language search engine and the largest Arabic matrimonial website.
Yahoo! is the world’s second most visited website after Google.
The company pursued merger talks with Microsoft in 2005, 2006 and 2007, and in February 2008 Microsoft made an unsolicited bid for the company, which it withdrew three months later.
Microsoft said in July this year that it will have full access to Yahoo!’s search engine for future projects, including Bing.com.For all the latest tech news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
Subscribe to Arabian Business' newsletter to receive the latest breaking news and business stories in Dubai,the UAE and the GCC straight to your inbox.