eBay announced an agreement Wednesday to acquire Gmarket for a price of up to $1.2 billion, and Yahoo has agreed to sell its 10 percent stake in the South Korean e-commerce site in a move that would raise about $120 million.

Gmarket's board unanimously approved eBay's tender offer, in which the online auction and commerce site will pay a cash price of 31,767 Korean won, or $24, per share for all common shares and all American Depository Shares. eBay said it's assured of owning at least 67 percent of the company, and if it acquires all shares in the tender offer, the total price will reach about $1.2 billion.

eBay said it will combine Gmarket with its own Korean operations, the Internet Auction Co. it acquired in 2001, , though it will still use separate Web sites. "This deal creates strong operational synergies between the two market leaders, offers more opportunities for sellers and enhances our ability to serve complementary consumer segments," said John Donahoe, eBay's president and chief executive officer, in a statement.

eBay, once an e-commerce darling but now under more financial pressure, is making dramatic moves. The company plans a 2010 initial public offering to spin off Skype, its Internet telephony group.

The Gmarket offer, pending final approval by Korean antitrust authorities, would give eBay a significant new source of revenue. While its existing IAC business produced revenue of $161 million on $2.2 billion in gross merchandise sales, Gmarket produced $221 million on $3.2 billion in sales, eBay said. The company's offer is a 20 percent premium over Gmarket's closing price of $19.96.

With the recession hurting advertising revenue and Google supplying relentless competition, Yahoo is under pressure of its own. The company could announce more layoffs as it reports financial results next Tuesday, and raising $120 million could also help appease shareholders dissatisfied with Yahoo's financial condition.