The stock advanced for a fourth day, rising to as much as $23.88, a new high in the past twelve months, in earlier trading before narrowing gains to $23.39 shortly after midday.
Terms of the transaction were not revealed, though technology blog AllThingsD reported that Yahoo paid roughly $30 million, citing anonymous sources.
The deal is the latest in a string of small acquisitions made by Yahoo and intended to bolster its mobile services.
Launched in November, the Summly app takes any news story and boils it down to a 400-word summary, so they can be easily displayed and read on mobile devices.
Summly was founded in 2011 by Nick D'Aloisio who was 15 years old at that time.
“Our vision is to simplify how we get information and we are thrilled to continue this mission with Yahoo!’s global scale and expertise,” D’Aloisio said in a post about the acquisition. “After spending some time on campus, I discovered that Yahoo! has an inspirational goal to make people’s daily routines entertaining and meaningful, and mobile will be a central part of that vision. For us, it’s the perfect fit.”
According to Yahoo’s blog, the Summly app will shut. “While the Summly app will close, you will see the technology come to life throughout Yahoo!’s mobile experiences soon.”
Yahoo Chief Executive Marissa Mayer is stepping up the company's efforts to build online services for the smartphones and tablets that consumers increasingly use to access the Web.
Sunnyvale, California-based Yahoo has acquired a handful of small, mobile start-ups since Mayer took over last July, though the company has yet to do any large acquisitions.
Yahoo recently bought Stamped, a mobile app that let users review and share their favorite things; OnTheAir, which is an app that enables webinars that can be watched via a live stream; Snip.It, a social media website; and Propeld, which was a start-up focused on making local recommendations.
Yahoo is also in talks to buy a controlling stake in France Télécom SA’s online-video site Dailymotion, according to media reports, in what would be Mayer’s first major acquisition since taking over the Internet pioneer last year.
Three Summly employees will join Yahoo as part of the deal, which is expected to close in the second quarter. D'Aloisio will remain in London and be Yahoo's youngest employee.
Yahoo, with a market value of $25.7 billion, has soared about 50 percent since Mayer was named CEO.