Building on its acquisition of Right Media, Yahoo increases its investment in areas that fortify the portal's long-term success.

Late Tuesday, Yahoo! announced that it had acquired BlueLithium for $300 million dollars in an all cash deal, giving the struggling portal a boost in terms of offering advertisers enhanced media opportunities.

"BlueLithium's products, technology and team will be an integral part of our drive to build the industry's leading advertising and publishing network," said Yahoo CEO Jerry Yang. "This acquisition will extend our ability to deliver powerful data analytics, advanced targeting and innovative media buying strategies to our customers, who are increasingly looking for these insights. By leveraging BlueLithium's complementary expertise and tools, we will be able to better address the needs of our performance-based display advertisers and enhance the value of our publishers' inventory."

Kendall Allen, managing director of Incognito Digital, said the deal presents a boon to interactive agencies because it allows Yahoo to offer a broad and deep pool of users.

"I think [BlueLithium and Yahoo] can put together some really interesting packages," Allen said. "This is an impressive acquisition as far as advertisers go because Blue Lithium seems to have crafted its formula with consumer content interests in mind. Ad network acquisitions are certainly rampant, but Yahoo seems to have set itself apart with this one."

According to Allen, the acquisition will yield both a wide-reaching and well-targeted audience pool for advertisers.

Dave Smith, CEO of Mediasmith, said the acquisition will allow Yahoo to work with a broader range of advertisers.

"Yahoo has been concentrating on the big brands from a sales standpoint," Smith said. "A network like BlueLithium actually gives Yahoo the chance to extend their reach into the mid and smaller sites while gaining expertise in the sweet spot of networks, direct response advertising. This acquisition definitely broadens the scope of advertisers that Yahoo can call on."  

In a statement released by Yahoo, the company said BlueLithium, which will operate as a wholly-owned subsidiary, will be an active participant in the Right Media Exchange, which Yahoo bought in April for $680 million.

"The combination of BlueLithium's network and Yahoo's engaged audience will provide an unprecedented buying opportunity across what we believe will be one of the world's leading online display ad networks," said Susan Decker, president, Yahoo. "And BlueLithium's expertise in network management will better enable Yahoo to manage supply and demand across our network, by balancing advertiser goals with publisher value. Building on our acquisition of Right Media, this transaction demonstrates our commitment to increasing our investments in areas which can most contribute to Yahoo's long-term success."

BlueLithium CEO Gurbaksh Chahal will remain with the company on an interim basis to oversee the transition.

Michael Estrin is associate editor at iMediaConnection. Read full bio.