Yahoo to Join S&P; 500, Replacing Laidlaw

Yahoo Inc., operator of the leading Internet search service and directory, will be added to the Standard & Poor’s 500 index after the market closes next Tuesday, replacing Laidlaw Corp., Standard & Poor’s Corp. said Tuesday.

Santa Clara, Calif.-based Yahoo becomes the second Internet company in the index, joining America Online Inc.

“What it says is that the Internet slowly but surely is becoming a key part of the U.S. economy,” said David Blitzer, S&P;’s chief economist and chairman of the committee that picks index members. “We’re saying it’s a company that should be counted among 500 very important, leading companies in the U.S.”

Yahoo shares soared $21.63 to $234.38 in Tuesday’s after-hours trading after S&P;’s announcement. The stock lost ground in the regular session.

S&P; said it’s removing Laidlaw, North America’s largest bus operator, from the index for “lack of representation”--meaning it no longer meets the criteria for inclusion, such as the size of the company and the importance of its industry to the economy.

Companies’ shares typically rise when they join the S&P; 500 because many mutual funds that try to mimic the performance of the index must buy the shares.