Report: Yahoo's board approves $1.1B purchase of Tumblr

Story Originally Appeared in The Detroit News

Yahoo! Inc.'s board has approved a $1.1 billion acquisition of Tumblr Inc., a service that hosts 108 million blogs, the Wall Street Journal reported, citing unidentified people familiar with the matter.

Tumblr would continue to operate as an independent business and a deal may be announced as early as tomorrow, the people told the newspaper.

Yahoo has scheduled a press event in New York tomorrow, where it will unveil updates to its Flickr photo-sharing site, a person familiar with the matter told Bloomberg News. While Tumblr is based in New York, there were no indications that the event was related to a potential deal with Tumblr.

Founded in 2007 by entrepreneur David Karp, Tumblr had more than 13 billion global page views in the past month. The site recently began letting advertisers pay for prominent placement, putting the company on a path to achieve profitability this year, executives said in March. Yahoo Chief Executive Officer Marissa Mayer has been adding features designed to win back users who have fled the Web portal in favor of competing sites such as Facebook Inc. and Google Inc.

Katherine Barna, a spokeswoman for Tumblr, didn't respond to multiple requests for comment. Sara Gorman, a spokeswoman for Sunnyvale, California-based Yahoo, declined to comment.

CEO since July, Mayer had little to show for her efforts to turn around the company as of last month, when Yahoo reported a drop in its main display-advertising business and issued a sales forecast for this quarter that may fall short of analysts' estimates. Mayer's push to revamp products such as Yahoo's home page and e-mail have made little headway to reverse a decline in display, an area where Google and Facebook are gaining ground.