Google to Acquire YouTube for $1.65 Billion

Google announced yesterday that it would buy YouTube, the popular video-sharing Web site, for stock that it valued at $1.65 billion.

Google beat out a number of other YouTube suitors, including Microsoft, Viacom, Yahoo and the News Corporation. By successfully negotiating the deal, Google has once again proved that it is the Internet’s dominant player.

Under the terms of the deal, YouTube will retain much of its identity and will keep its name and its office in San Bruno, Calif., more than 25 miles from Google’s headquarters in Mountain View.

Chad Hurley, YouTube’s co-founder and chief executive, has repeatedly said he would prefer for his company to remain independent. Asked about such comments in a conference call with Wall Street analysts and investors held late afternoon yesterday, Mr. Hurley said his company did want to stay independent, adding that “by working with Google, that’s still the case.”

Steve Chen, also a YouTube co-founder, said, “It is hard for me to imagine a better fit for two companies,” both in terms of technology and company culture.

In anticipation of the acquisition, investors pushed shares of Google up $8.50, or 2 percent, on Nasdaq on Monday to a closing price of $429.00 -- a level not seen since late April. In extended-hours trade following the announcement of the deal, Google stock dipped to $427.63.

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Google to Acquire YouTube for $1.65 Billion (The New York Times)
Google to acquire video site YouTube for $1.65 bln (Reuters)