Yahoo! has acquired Zimbra, a provider of web based email and online/offline office software, for a cash price of $350m (£175.5m).

Zimbra’s product is essentially a web based version of Outlook, though the company recently added Zimbra Desktop, which allows users to access email and other functions when offline.

Zimbra is currently the email provider for a number of colleges, ISPs and universities, as well as businesses like Digg and Mozilla. The company had around 6m users of its service in May this year.

Yahoo! Mail is the current leader in web based email services, with around 250m users. The acquisition strengthen that position, as well as helping Yahoo! create a suite of office applications to compete with the likes of Google and Microsoft.

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