Bebo bought by Time Warner for US$850m
Ireland’s most popular social networking site, Bebo, is to be acquired by AOL, the internet division of Time Warner, for US$850m – a whopping US$270m more than Rupert Murdoch paid for MySpace back in 2005.
Bebo's current president Joanna Shields will continue to run Bebo after the deal is completed but will be reporting to Ron Grant, AOL's president.
"Bebo is the perfect complement to AOL's personal communications network and puts us in a leading position in social media," said Randy Falco, chairman and CEO, AOL.
"What drew us to Bebo was its substantial and fast-growing worldwide user-base, its vision of a truly social web and the monetisation opportunities that leverage Platform-A across our combined global audience.
"This positions us to offer advertisers even greater reach and marketers significant insights into the desires and needs of consumers."
Currently Bebo's advertising is served by Yahoo! but the AOL deal would suggest this will no longer be the case as the Time Warner subsidiary has recently spent almost US$1bn on online advertising acquisitions.
Time Warner's acquisition of Bebo is good news for European venture capital firm, Balderton Capital. The company sold its 15.7pc stake in the company for US$140m, nine times more than its original investment in Bebo.
"We got involved in an exciting and competitive investment in Bebo because we believed in the social networking space and that Bebo was positioned for exponential growth.
"Our expectations for Bebo have been exceeded in a relatively short period of time, and today's transaction with AOL has delivered an exceptional return on our original investment in 2006," said Barry Maloney, a partner in Balderton Capital.
By Marie Boran