Microsoft Admits £4bn Ad Firm Now 'Worthless'

Microsoft has admitted one of its largest acquisitions in the internet sector is effectively worthless, wiping out any profit for the last quarter. The company announced a $6.2bn (£3.95bn) charge to write down the value of aQuantive, an online advertising agency it bought five years ago. The announcement came as a surprise, but did not shock investors. The purchase of aQuantive in 2007 had initially been expected to boost Microsoft's online advertising revenue and counter Google's purchase of digital ad firm DoubleClick. But the world's largest software company admitted: "The acquisition did not accelerate growth to the degree anticipated, contributing to the write-down." Microsoft bought aQuantive for $6.3bn (£4.01bn) in an attempt to catch Google in the race for revenues from search-related display advertising. It was Microsoft's biggest acquisition at the time, exceeded only by its purchase of Skype for $8.5bn (£5.4bn) last year. But it never proved a success and aQuantive's top executives soon left Microsoft. As a result of its annual assessment of goodwill - the amount paid for a company above its net assets - Microsoft said it would take a non-cash charge of $6.2bn, indicating the aQuantive acquisition is now worthless. The charge is likely to wipe out any profit for the company's fourth financial quarter.