AOL Buys Huffington Post for $315 Million

Nice job cashing out by Arianna Huffington, now that the HuffPo has turned into a typical free-for-all content farm.  The most logical move was to hand over the keys at a great valuation to AOL ($AOL), a supposed “content company” still in search of its raison d’etre.

From the New York Times:

AOL to Buy The Huffington Post in $315 Million Deal

The Huffington Post, which began in 2005 with a meager $1
million investment and has grown into one of the most heavily
visited news Web sites in the country, is being acquired by
AOL in a deal that creates an unlikely pairing of two online
media giants.

The two companies completed the sale Sunday evening and were
expected to announce the deal Monday morning. The deal will
allow AOL to greatly expand its news gathering and original
content creation, areas that its chief executive, Tim
Armstrong, views as vital to reversing a decade-long decline.

Henry, here’s how the deal was structured, FYI:

The two companies completed the sale Sunday evening and announced the deal just after midnight on Monday. AOL will pay $315 million, $300 million of it in cash and the rest in stock.

Tim Armonstrong‘s anachronistic bet on content and “news” is starting to look increasingly Courtney Love Crazy.  And that’s coming from a content creator.  His last quarterly ad revenues were down 29%, display ads were down 14%.  The best part of the deal for AOL is that Arianna sticks around and takes control of the whole ship, content-wise.  The following from the official press release:

As part of the transaction, Arianna Huffington, The Huffington Post’s co-founder and editor-in-chief, will be named president and editor-in-chief of The Huffington Post Media Group, which will include all Huffington Post and AOL content, including Engadget, TechCrunch, Moviefone, MapQuest, Black Voices, PopEater, AOL Music, AOL Latino, AutoBlog, Patch, StyleList, and more.

Expect a doubling of posts per day from all of those sites.  And will she really allow Engadget to live alongside TechCrunch for much longer?

Sources:

AOL to Buy the Huffington Post (NYT)

You’ve Got Arianna (AllThingsD)

This content, which contains security-related opinions and/or information, is provided for informational purposes only and should not be relied upon in any manner as professional advice, or an endorsement of any practices, products or services. There can be no guarantees or assurances that the views expressed here will be applicable for any particular facts or circumstances, and should not be relied upon in any manner. You should consult your own advisers as to legal, business, tax, and other related matters concerning any investment.

The commentary in this “post” (including any related blog, podcasts, videos, and social media) reflects the personal opinions, viewpoints, and analyses of the Ritholtz Wealth Management employees providing such comments, and should not be regarded the views of Ritholtz Wealth Management LLC. or its respective affiliates or as a description of advisory services provided by Ritholtz Wealth Management or performance returns of any Ritholtz Wealth Management Investments client.

References to any securities or digital assets, or performance data, are for illustrative purposes only and do not constitute an investment recommendation or offer to provide investment advisory services. Charts and graphs provided within are for informational purposes solely and should not be relied upon when making any investment decision. Past performance is not indicative of future results. The content speaks only as of the date indicated. Any projections, estimates, forecasts, targets, prospects, and/or opinions expressed in these materials are subject to change without notice and may differ or be contrary to opinions expressed by others.

Wealthcast Media, an affiliate of Ritholtz Wealth Management, receives payment from various entities for advertisements in affiliated podcasts, blogs and emails. Inclusion of such advertisements does not constitute or imply endorsement, sponsorship or recommendation thereof, or any affiliation therewith, by the Content Creator or by Ritholtz Wealth Management or any of its employees. Investments in securities involve the risk of loss. For additional advertisement disclaimers see here: https://www.ritholtzwealth.com/advertising-disclaimers

Please see disclosures here.

What's been said:

Discussions found on the web
  1. cloud based test management tool commented on Feb 07

    … [Trackback]

    […] Find More on that Topic: thereformedbroker.com/2011/02/07/aol-buys-huffington-post-for-135-million/ […]