News Corp sells MySpace to Specific Media for $35 million
After a sales process that lasted several months and featured a last-minute swerve, Rupert Murdoch's News Corp. agreed today to sell social networking site MySpace to online advertising network Specific Media for $35 million, including a minority stake in Specific and a small amount of cash.
The deal's price tag is $545 million below what the media giant had spent on acquiring MySpace several years ago.
The conglomerate, which managed to finalize the deal to offload the company just before its fiscal year ends Thursday, was hoping for a $100 million price tag when it decided for a sale earlier this year amid a continuing slump of MySpace. In comparison, earlier this year, Facebook, which is expected to go for an IPO next year, was valued at $65 billion-plus in private investment deals.
MySpace's value has dropped as Facebook became the dominant social network, and MySpace has continued to lose money and subscribers.
In the U.S., MySpace had 75.9 million unique visitors in Dec. 2008 at its peak, but only 34.9 million in May, according to comScore.
For the nine months ended March 31, News Corp. reported a loss of $477 million for the segment that includes MySpace, compared with $401 million in the year-ago period. While the company typically doesn't break out MySpace's financials separately, it has said that lower search and advertising revenue has been partially offset by reduced costs in many a recent quarter.
More on the sale via the Hollywood Reporter.
The deal's price tag is $545 million below what the media giant had spent on acquiring MySpace several years ago.The conglomerate, which managed to finalize the deal to offload the company just before its fiscal year ends Thursday, was hoping for a $100 million price tag when it decided for a sale earlier this year amid a continuing slump of MySpace. In comparison, earlier this year, Facebook, which is expected to go for an IPO next year, was valued at $65 billion-plus in private investment deals.
MySpace's value has dropped as Facebook became the dominant social network, and MySpace has continued to lose money and subscribers.
In the U.S., MySpace had 75.9 million unique visitors in Dec. 2008 at its peak, but only 34.9 million in May, according to comScore.
For the nine months ended March 31, News Corp. reported a loss of $477 million for the segment that includes MySpace, compared with $401 million in the year-ago period. While the company typically doesn't break out MySpace's financials separately, it has said that lower search and advertising revenue has been partially offset by reduced costs in many a recent quarter.
More on the sale via the Hollywood Reporter.
Comments