Bidders crowd MySpace
Going for a song
MySpace’s new owner is expected to be announced this week as speculation suggests that News Corp is in final negotiations with two potential buyers, advertising network Specific Media and private equity firm Golden Gate Capital.
The price tag for the failed social network has been mooted as US$35 million, a fraction of New Corp’s original purchase price of $580 million in 2005.
If the sale price is correct it will illuminate that the market is back on track for irrational dot.com styled valuations when compared to the social media acquisition made by the Australian arm of News Corp yesterday, which acquired a local parenting focused blog network for US$45 million.
Despite MySpace’s fall from grace it still yields 34.9 million monthly global visitors.
Specific Media raised $US100 million from private-equity firm Francisco Partners in 2007 and has been making small acquisitions including Broadband Enterprises, an online video company.
MySpace co-founders Chris DeWolfe and Tom Anderson have also been named as potential knights in private equity-backed armor looking at submitting a last minute salvage bid for their progeny.
My Space is expected to sack another 150 staff today with a further 50% of the remaining staff of under 400 expected to be shed once the deal is done. ®