The advertising M&A game just keeps going and going…. MarketWatch reported earlier this evening that Yahoo will buy ad network BlueLithium for $300 million in cash. Yahooeatsbluelithium Blue Lithium, as I reported in my blog post How the Top Ad Networks Rank on August 18, is currently the fifth largest ad network. A few minutes ago, this Red Herring article went up, noting that Blue Lithium was founded in January 2004 and was backed by Walden Venture Capital and 3i. The article went on to state:

BlueLithium is also known for its behavioral targeting, which has become the must-have for online marketers. Behavioral targeting allows marketers to target users based on the sites they’ve visited, as well as demographic and geographic characteristics. Yahoo recently launched SmartAds, a nascent effort in this area.

YHOO was up 5.46% today, closing at 23.97. In after hours trading, it was up another 0.63% to 24.12 as of about 8:00 pm Eastern.