MANILA, Philippines (2ND UPDATE) – What was earlier seen as intriguing speculation has come true. Search engine giant Yahoo! and blogging service Tumblr are set to join forces as the “definitive agreement” has been made for Yahoo! to acquire Tumblr.

According to the announcement, “Tumblr will be independently operated as a separate business. David Karp will remain CEO. The product, service and brand will continue to be defined and developed separately with the same Tumblr irreverence, wit, and commitment to empower creators.”

The announcement was also broken by Yahoo! CEO Marissa Mayer, who posted a tweet and relayed the message on Tumblr as well, promising to “not screw it up.”

First ever acquisition announced by animated gif 🙂 @yahoo is acquiring @tumblr. finance.yahoo.com/news/yahoo-acq…#keepcalmandcarryon

— marissamayer (@marissamayer) May 20, 2013

On Mayer’s Tumblr post, she explained that Tumblr and Yahoo can work together to improve the other’s capabilities and services. “In terms of working together, Tumblr can deploy Yahoo!’s personalization technology and search infrastructure to help its users discover creators, bloggers, and content they’ll love,” Mayer writes. “In turn, Tumblr brings 50 billion blog posts (and 75 million more arriving each day) to Yahoo!’s media network and search experiences.”

She adds that Yahoo! and Tumblr “will also work together to create advertising opportunities that are seamless and enhance user experience.”

A post by David Karp on the Staff Tumblr also allayed fears that the acquisition would fundamentally change Tumblr in spirit. He writes, “We’re not turning purple. Our headquarters isn’t moving. Our team isn’t changing. Our roadmap isn’t changing. And our mission – to empower creators to make their best work and get it in front of the audience they deserve – certainly isn’t changing.” 

Karp also added some praise for Yahoo! as a company and an entity of the Internet, saying, “Yahoo is the original Internet company, and Marissa and her team share our dream to make the Internet the ultimate creative canvas. I couldn’t be more excited to have her help.”

The total consideration for the deal is approximately US$1.1 billion, and “substantially all of which is payable in cash.”

On the Yahoo! Tumblr page, it was also noted that “The transaction is subject to customary closing conditions, and is expected to close in the second half of the year.” – Rappler.com