Yahoo! and Google reach ad deal

SUNNYVALE, Calif., June 13 (UPI) -- Yahoo! Inc. said it reached a non-exclusive agreement with California Internet giant Google Inc. to run Google ads alongside its own search engine results.

The deal allows Yahoo! to display paid search results from Google, other third parties and Yahoo!'s Panama marketplace, a company statement said.

Yahoo! Chief Executive Officer Jerry Yang called the convergence of search and display "the next major development in the evolution of the rapidly changing online advertising industry."

Yahoo! called the agreement an "$800 million annual revenue opportunity" and said it expected it would yield $250 million to $450 million in the first 12 months.

The agreement includes a $250 million termination fee that Yahoo! would pay "as a result of a change in control that occurs within 24 months."

In a separate statement, Yahoo! announced that discussions with Microsoft Corp, which made a $44.6 billion purchase offer for Yahoo! in January "had concluded."

The companies had been discussing an alternative transaction, a statement from Microsoft said.