"Yahoo has made the most significant push into the Arab world of any major internet company, acquiring Maktoob, the region's most popular web portal. The deal is the first large-scale foreign acquisition of a Middle Eastern website."

Up until now, Yahoo has held a weak presence in the Arab region, with no dedicated portal to speak of (though it still managed to attract millions of Arab users to its sites). The deal effectively gives Yahoo an instant foothold in the market. According to MaktoobBusiness, products will be cobranded with Yahoo and Maktoob, with the deal completing in the fourth quarter and new products rolling out next year.

Now that the dust around Yahoo's search business has subsided, Yahoo can once again focus on the thing it does well: its portal business. They've officially announced they will be acquiring Arabic internet portal Maktoob, extending their influence over some 16.5 million people; Yahoo calls this its "biggest geographic expansion in years."

This is not just an acquisition of another web portal; it's Yahoo moving into a completely different and new market, which means translating Yahoo's services into Arabic. From the official Yahoo corporate blog:

This is the first time in the history of the internet in the Arab world that such a deal has taken place, and promises to take the internet industry in the region to a whole new level; hopefully in terms of quality, content, competition, awareness and investment opportunities.

When looking at other global players, Google chose to open small presences of its own, mainly in the UAE and Egypt, to work on some product concept development, marketing and sales in the region. Microsoft already have a wide existence in the Arab world, but mainly around their big software titles, only recently starting to look online in the Arab world.

Hopefully this deal, as well as Google and Microsoft's moves in the region, will open the door for more international players to start seriously considering entering the online market in the Arab world, but even more importantly will show local investors the potential that exists in investing in sound internet startup ideas, and that with the region as an important emerging market, there are more exit strategies than they initially thought.

Paid Content chimes in with their thoughts, adding that sources told the blog that the deal was worth between US$75 million to $80 million:

A very important concern that will come up with this acquisition by a global company like Yahoo: concerns over freedom of speech in a region known for censorship of free speech online. Yahoo will be closely watched on how it reacts to such concerns and requests by local governments from here on. Its China policy has come under fierce criticism over the years.

Keith Nilsson, Yahoo's senior vice president for emerging markets, writes on the official Yahoo blog:

This deal is part of Yahoo!'s broader strategy to grow our international business, particularly in emerging markets. In many countries, vast populations -- and advertisers -- are just starting to come online. The potential is tremendous. Yahoo! has a large and growing audience in these markets today, and our acquisition of Maktoob represents the kind of investment we're making to cater to the needs of these promising regions.

We plan to join forces with the Maktoob team, the strongest in the region, to create locally relevant content, services, and programming. That's no easy task when you consider the differences between countries like UAE, Jordan, Kuwait, Egypt and Saudi Arabia. But we're committed to literally translating our winning formula for this growing market in many ways, including through locally-based editorial teams.

And finally, the official press release from Yahoo can be found here. A selection is below:

"This acquisition will accelerate Yahoo!'s strategy of expanding in high-growth emerging markets where we believe Yahoo! has unparalleled opportunity to become the destination of choice for consumers," said Yahoo! chief executive officer Carol Bartz. "Access to information and communications tools can positively impact people's lives in many ways, and with the acquisition of Maktoob.com and our investment in the region, the Arab world will soon get a Yahoo! experience in Arabic with relevant local language content, programming and services."

Internet users in the region will benefit from the combination of Yahoo!'s popular products and services with Maktoob's compelling local content, which today reaches one in three people online throughout the Arab world. This acquisition will extend Yahoo!'s current offerings by adding capabilities to deliver relevant Arabic-language content and services, as well as Arabic versions of Yahoo!'s popular Yahoo! Messenger and Yahoo! Mail services. Maktoob.com is accessed by users in countries that include UAE, Jordan, Kuwait, Egypt and Saudi Arabia.

"Yahoo! and Maktoob are natural partners and this combination should help energize the Internet market in the region as a whole. We are excited about Yahoo! building a stronger presence in the Middle East and bringing its compelling suite of services to Arab users in Arabic," said Samih Toukan, Founder of Maktoob.