Microsoft agrees to buy aQuantive for $6 billion

NEW YORK (AP) — Microsoft Corp., not wanting to get left behind rivals in an online advertising boom, agreed to pay $6 billion in cash to acquire aQuantive Inc. on Friday, a leading agency for Internet ads that also has powerful technology that serves display and banner ads to other Web sites.

The eye-popping premium of 85 percent Microsoft is paying for aQuantive reflects a heated race for the few remaining online advertising businesses.

The deal caps a month of furious activity in the sector that began in mid-April with Google Inc.'s $3.1 billion purchase of DoubleClick Inc., a company that provides technology used by Web site publishers to deliver advertisements to viewers.

Google is already the leading provider of keyword search advertising, which suggests "sponsored" links along with search results. Companies like DoubleClick and aQuantive help provide the delivery of "display" ads on Web sites such as banners and boxes, which lead users to advertiser's Web sites.

For Microsoft, getting aQuantive could jump-start its online advertising business, which lags far behind Google and Yahoo Inc. due to the lower traffic on its own destination Web site, MSN. The deal "certainly keeps them in the competitive arena with Google," A.G. Edwards analyst Denise Garcia says.