VMware to buy Zimbra from Yahoo

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PALO ALTO, Calif. (AP) — VMware Inc. said Tuesday it has agreed to buy the software company Zimbra Inc. from Yahoo Inc.

Zimbra makes software for collaborating on projects and sending e-mail. VMware said it is acquiring all of Zimbra’s intellectual property, while allowing Yahoo to continue using the company’s technology in its own e-mail and calendar applications.

VMware provides virtualization technology, which helps companies save money on power and hardware by allowing one computer to function like several machines.

It said the Zimbra acquisition will help it build a portfolio of inexpensive applications to offer business customers.

Financial details were not disclosed. The companies expect to close the deal by the end of March.