AOL's Reported Sale of Bebo for $10M – Another Indication of that AOL is on the Block?

Studio City, CA – AOL is close to selling the online social network Bebo, which AOL acquired for $850 million two years ago, for just $10 million to Los Angeles-based
digital media investors Criterion Capital Partners, according to TechCrunch.

VentureBeat reports that sources close to the negotiations between AOL and Los Angeles-based
digital media investors Criterion Capital Partners, said that AOL executives are "livid that the news has broken and
believe Criterion leaked the information.”  

According to the reports, if AOL had shut down Bebo rather to sell it, they would have realized a tax savings of around $380 million, while selling Bebo only allows them to write off the loss against capital gains. So why is AOL selling Bebo? If AOL is pursuing its own acquisition strategy, “the banked capital-gains writeoff could be valuable to an acquirer who could use it to capture the savings,” according to VentureBeat.

Lately there has been speculation that AOL is setting itself up for an acquisition with Microsoft and Yahoo mentioned as possible buyers.

Related Links:

VentureBeat Article:  http://venturebeat.com/2010/04/06/aol-may-finally-give-up-on-its-850-million-purchase-of-bebo/

Wall Street Journal Article: http://online.wsj.com/article/SB10001424052748704198004575310782837615268.html?mod=WSJ_business_whatsNews

AOL shares up on Microsoft bid target talkhttp://news.yahoo.com/s/nm/20100604/wr_nm/us_aol_shares