It was just supposed to be a three-hour tour, um, quick sale process!
But, like a storm-tossed ship looking for any safe harbor, the MySpace sale is still chugging along, with a deal that continues to be tossed around among low-paying and new lesser-known buyers who are now in the $20 million to $30 million range, said sources close to the situation.
The price, said others, could go as high as $35 million, but it's far cry from the $100 million that News Corp. had been aiming for.
As part of the deal, sources said the News Corp. unit will be making significant cuts in staff and costs--up to 50 percent or more--all contingent on the purchaser. The staff cuts are, obviously, directly related to the transaction and the winning bidder.
The media giant might also retain a small minority stake.
The two names--Specific Media and Golden Gate Capital--that are now in the forefront for an acquisition deal that News Corp. hopes to complete by Thursday, its fiscal year-end, have not been among the acquirers mentioned previously in the myriad of reports about the deal.
Specific Media--a large, if lesser known, advertising network--seems to be in the lead, said sources. It has been around for a half-decade and has been funded by Francisco Partners.
Golden Gate Capital is a private equity firm with $9 billion under management, which has mostly specialized in turning around companies. It has never invested in a consumer Internet company.
Both companies, sources said, will focus MySpace on music, although it is not clear which rights the site has with music labels will transfer to a new owner.
Until last week, the preferred deal for MySpace centered on an investor group that included Activision CEO Bobby Kotick and in which News Corp. (which also owns AllThingsD) would retain a large minority ownership stake.
But sources said there were some transactional and legal complexities that made it less attractive and News Corp. opened up the deal talks with others again last week.
Golden Capital and Specific Media emerged most aggressively, although there still remain other interested parties, sources close to the situation said, among them another investor group that includes MySpace co-founder Tom Anderson, one its other co-founder Chris DeWolfe is part of and also interest from the Criterion Capital Partners, which bought AOL's Bebo social networking site on the cheap a year ago.
But it's now come down to time constraints and an agreement that can be reached before the end of this month, which is also the end of the media giant's fiscal year.
In other words, let's get MySpace off the books for 2012!
How it came to this will likely be the focus of many a business school case. After a spectacular start, MySpace has fallen on hard times both in terms of traffic and advertising revenues.
That's why the music-focused social networking site has not sat exactly in the catbird's seat in terms of negotiating leverage.
While there were some rumors last week that News Corp. would close MySpace down, the sale to a small player and the layoffs are the likely outcome.
While that's cold comfort to its employees, it's about the best MySpace can hope for right now.