In a bid to bolster its position as a digital content giant, professional network company LinkedIn (LNKD) reported after Thursday’s closing bell that it was spending $90 million to buy Pulse, a newsreader and mobile content distribution application owned by Alphonso Labs, Inc. LinkedIn will make the payment 90 percent in stock and $9 million in cash.
Pulse collects articles and then allows users to select from a range of topics and interests to customize their feeds with unique pages and sources. It won the Apple Design Award and was a member of TIME magazine’s top 50 apps of 2011, amongst other accolades.
The news wasn’t a complete shock for many as AllThingsD’s Kara Swisher reported in March that the acquisition was going to happen.
Founded just three years ago as a class project by then Stanford University graduate students Akshay Kothari and Ankit Gupta, Pulse has grown to having more than 30 million users in 190 countries with more than 750 publishers distributing content through the company. About 40 percent of Pulse users are outside the United States.
"We are thrilled to be able to add Pulse's considerable talent, technology, and products to our growing ecosystem of content offerings, and we believe that they will help us accelerate our ability to deliver to our members the insights they need to be better at what they do, on any device," said Deep Nishar, SVP of Products and User Experience at LinkedIn.
Nishar went on to explain that the company has a goal to become the “definitive professional publishing platform” and that the acquisition is a “perfect complement to this vision.”
LinkedIn shares the same vision of many other social media websites and mobile applications: to lure publishers and authors in to drive user traffic through compelling content and generate revenues through incredible traffic volume and app users.
LinkedIn has been making moves to increase traffic by retaining its core competencies as a business-connection service, but also providing greater content to engage readers as a news provider.
“Millions of professionals are already starting their day on LinkedIn to glean the professional insights and knowledge they need to make them great at their jobs.,” Nishar blogged in an post welcoming Pulse to the LinkedIn family.
The acquisition is expected to close in the second quarter of 2013.
Last month, Yahoo! (YHOO) agreed to spend $30 million to buy 17-year-old Nick D’Aloisio’s newsreader application called “Summly.” Yahoo didn’t want the app per se, it wanted the algorithms it uses to takes long-form articles and shortens them for users of smartphones and other mobile devices.
Shares of LNKD closed on Thursday at $180.18, up 1.6 percent on the day. The after market news did little to alter the closing price.