Update: This story has been updated to add comments from Microsoft Ventures and a statement from Yahoo.

Yahoo Inc. has acquired BookPad Inc., a Mountain View, California-based startup, which was mentored by Microsoft Corp.’s startup incubator program in India, two people with knowledge of the deal told International Business Times on Monday.

Microsoft's accelerator program for India, which is like a fast-tracked incubation program, lasts four months at a time. BookPad’s three Indian founders, including CEO Aditya Bandi, were part of the program’s fourth edition. Bandi is a graduate of one of India’s premier engineering schools, the Indian Institutes of Technology, and previously did stints with IT services company Cognizant Technology Solutions and as a consultant with Microsoft.

BookPad has a development center in Bangalore, India’s fast-emerging startup hub, where the founders fine-tuned a way to view, annotate and collaborate on documents from within various applications. Their product is called DocsPad, which can be accessed off the cloud and a user does not have to download a document to work with it.

The editing feature, which is currently unavailable, is expected to be added soon, although upon integration with Yahoo, the DocsPad service in its current form would shut down to appear in a new avatar, one of the persons that spoke to IBTimes said. Cloud computing refers to renting computer storage and software on the Internet rather than purchase them outright.

An email sent to BookPad in India didn’t elicit responses at the time of publishing. A Yahoo spokeswoman told IBTimes in an email that the company did not have an "announcement to share on this news" yet.

India’s Economic Times newspaper reported the value of the deal was 500 million rupees ($8.2 million), citing two people with knowledge of the deal it didn’t name.

“The deal is mutually beneficial. It would help them (BookPad) to get their products into the next level, and as it allows documents to be viewed on multiple hand-helds, clearly Yahoo see it as a strategic investment” as more people use smartphones for an increasing number of tasks, Rajat Tandon, a senior director at the National Association of Software and Services Companies, an industry lobby, or Nasscom, told IBTimes.

BookPad first caught Microsoft's attention last year, when the startup made a presentation at an annual products conference organized by Nasscom. That led to their being selected for the accelerator program, Ravi Narayan, a director at Microsoft Ventures told IBTimes in a phone interview Monday.

“We selected them primarily because the technology they had created was unique, we felt that it was a great play for several different applications,” Narayan said.

“For BookPad, it’s a nifty technology ... but for one small company to go around, find applications, convince the providers to use it and so on will take a very long time. If Yahoo were to incorporate in their offerings or made it available to their customers, it automatically expands the reach for this technology,” he said. “For Yahoo this probably is a solution for providing uniform document rendering ... they could have probably built it over a period of time, but this (acquisition) was a way to very quickly cut the go-to-market (time).”

BookPad also benefited from a startups mentoring program that Nasscom runs, called the "Nasscom 10,000 Startups," which helped the founders make a trip to Silicon Valley last year, build contacts and showcase their work, Tandon said.

Bandi, and co-founders Niketh Sabbineni and Ashwik Battu, “wanted to solve a problem,” one of the persons that spoke to IBTimes said, but declined to be named.

“If you were in the shoes of a user of a lot of cloud applications, with increasing uploads and downloads of documents it was more of a personal pain point to them (the founders) ... ‘hey the cloud is going to be so big that this sort of technology is required,’” said the person, who is closely associated with the company.