News Corp close to selling Myspace: source

Reuters News
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Posted: Jun 28, 2011 1:34 PM

NEW YORK (Reuters) - News Corp is expected to sell the troubled social media site Myspace in the next two days, according to a source familiar with the situation.

Two front-runners have emerged in the auction process: online ad company Specific Media and private equity firm Golden Gate Capital, the source said.

The deal is likely to be a mix of cash and stock for less than $100 million.

Additionally, more than 50 percent of Myspace's 500-strong workforce is expected to be laid off because of the deal.

News Corp paid $580 million in 2005 for Myspace -- once a pioneer of the social networking space -- but soon lost ground to Facebook, now the world's No. 1 social networking site.

The news was first reported by News Corp-owned AllThingsD.

(Reporting by Jennifer Saba. Editing by Robert MacMillan)