On Monday we broke the news that MySpace was in late stage negotiations to acquire music service iMeem. Those negotiations are now concluded, we’ve heard from multiple sources, and an agreement has been signed. MySpace will acquire most of the assets of iMeem for a purchase price of around $1 million in cash.
$1 million isn’t the “real” purchase price for the company. Some assets are being left behind, say our sources, including millions of dollars in accounts receivable plus some other cash. All or most of these assets, plus the purchase price, will be used to pay off some of the debt iMeem has accumulated.
About half of iMeem’s 55 employees will now work for MySpace. The rest, we’ve heard, will be looking for a new job.
One question that’s still unanswered – will the iMeem service live on? That’s completely up to the music labels, say our sources. iMeem’s deals with the labels terminate on this acquisition. The service is running at breakeven, we’ve heard, so MySpace may push to keep iMeem alive.
One thing is clear – MySpace is getting the iMeem assets for an absolute steal. I wouldn’t be surprised if other bidders suddenly get interested in iMeem and try to disrupt the deal before it actually closes.
MySpace and iMeem won’t comment on this story.
| Website: | |
| Website: | myspace.com |
| Location: | Beverly Hills, California, United States |
| Founded: | August 1, 2003 |
| Acquired: | July 1, 2005 by Fox Interactive Media for $580M in Cash |
MySpace is one of the world’s largest social networks, with about 125 million users. Originally inspired by Friendster, MySpace quickly grew to become the world’s largest social network, before… Learn More
| Website: |
| music.myspace.com | |
| Founded: | September 25, 2008 |
MySpace Music is a joint music venture, with equity stakes from major labels, that allows users to stream music on demand, create playlists, and add widget music players to their profiles. The streaming will be advertising supported - at first via… Learn More
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