Correction: I’d misquoted Yahoo India MD George Zacharias as stating that this is not an all cash deal (Yahoo is not disclosing the terms of the deal). Apologies for the misquote.
Original post (at 12 AM IST): I’m sitting here at a presscon where Yahoo India is going to announce a strategic investment in advertising network Tyroo...so here’s the funny bit - I found out about the press conference yesterday from Rediff PR, who was inundated with calls from reporters who had received an invite that said that Yahoo India is going to announce a strategic investment today. Anyway, the presscon is about to begin, so stay tuned for details.

Update: George Zacharias, Yahoo India MD said that the company has acquired upwards of 35 percent (between 35 and 50 percent) in Tyroo Media. Says that Yahoo will act as a catalyst for the advertising industry in India. The investment will enable Tyroo to create a sustainable and growing platform, and the company will be able to leverage Yahoo’s strengths. Harish Bahl, CEO of Smile Interactive, which is incubating Tyroo. They’re looking at the proverbial “long tail”, including advertisers with as small a budget as Rs. 2500. He says that 0.5 Billion impressions go waste daily in India. 50 percent of advertising goes to search, where only 5 percent of user time is being spent, so that balance has to change.

Update: the Q&A
Q. How much money has been invested?
Zacharias: No comments on the figure, but it’s not an all cash deal.

Q. Is this more about getting access to Yahoo advertisers? So far you’ve have advertisers from Quasar being directed to Tyroo. (Nikhil)
Bahl: We’ll be developing our own advertising clients and publisher network. The market is growing, and it’s about getting advertisers from everywhere on board.

Q. How much marketshare does Tyroo have. Given the number of ad networks being launched, is this something like a distress situation to retain marketshare? (Nikhil)
Bahl: Tyroo is the largest advertising network in India,and this is not a distress situation.

Q. How do you think this investment from Yahoo is going to affect getting publishers like Sify, Rediff and Indiatimes on board at Tyroo, since they are Yahoo competitors? (Nikhil)
Bahl: There will be no corporate governance issues - Tyroo and Yahoo will operate independently

Q. How does Tyroo fit into the Yahoo mandate? (Nikhil)
Zacharias: If you remember, we’ve bought out Right Media, so it’s a part of the overall Yahoo strategy to invest in this space. There is synergy in the sense that the Yahoo sales team might offer advertising inventory to Tyroo, and the Tyroo sales team might reciprocate.

Asked about the need for the sale, Bahl said that raising capital was not the objective, since the Smile Group already has an incubation unit. With Yahoo, Tyroo can attract international advertisers, and we might even take Tyroo global. The money will be used for growing the sales team and targeting the SME segment. It will also be used to improve the technology platform.

Update: wrt to Kates’ comment on why Yahoo didn’t get Right Media to India, I did ask Zacharias that, but he just said something like Tyroo has the technology and the presence in the market. The other thing is - upwards of 35 percent is a rather large stake—not many companies are willing to divest that much, even though it’s a minority stake...What will be interesting is—how will other players in the market respond? Bear in mind that Interactive Avenues has received funding from Sequoia Capital, and we’ve heard they’re planning an ad network