MySpace Founder Demands To Cancel News Corp Deal
Now that sites like YouTube and Facebook are worth billions of dollars , many people remember last year’s MySpace deal. The largest social network was sold for only $ 580 million. Its current owner is News Corp. already, in fact, paid off the investment, since it signed a advertising contract worth $ 900 million with Google. MySpace revenues this year will be about $ 250 million.
What happens? After last year’s deal, the MySpace portal magically turned into a super profitable company and began to bring huge amounts of money to its new owners?
In such a situation, the question naturally arises: wasn’t the price for which the company Intermix, the owner of MySpace, bought was too low? One of the founders of Intermix and its former CEO, Brad Greenspan, says it is. From the very moment of the transaction, he made statements that the cost of Intermix was clearly underestimated, and the real price of the company was at that time tens of billions of dollars. The people who cranked the deal, according to Greenspan, deceived Intermix shareholders.
Although after the deal with News Corp. more than a year has passed, but Brad Greenspan continues his struggle to this day. The other day, he published a large report in which he detailed all his arguments.
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According to Greenspan, the fair price of Intermix was $ 20 billion. He claims that insiders knew that the cost of business would soon come close to $ 20 billion, but the deal was still made as quickly as possible and at a reduced price. Nobody explained to shareholders that the company's revenues are growing at 1200% per year. They were persuaded to approve the deal as quickly as possible.
Thus, Intermix shareholders (and the largest of the private shareholders, Brad Greenspan himself) were deceived. Responsibility for this scam rests on two top managers who organized the fraud: this is Richard Rosenblatt (Richard Rosenblatt) by Intermix and Ross Levinson (Ross Levinsohn) by News Corp. They deliberately prevented the start of a standard auction and did not inform shareholders of the proposals of competitors.
For all these reasons, Greenspan insists that it is urgent to initiate an investigation before the evidence of fraud has been destroyed. In February 2006, Greenspan filed a lawsuit against News Corp. He believes the deal should be canceled, and Intermix and the MySpace portal should be withdrawn from News Corp.
True, there are several weak points in the argument of the former director of the company. The main thing is that Intermix at the time of purchase was a public corporation and its shares were quoted on the stock exchange. So, the market capitalization was lower than the price paid by News Corp. If such excellent business prospects were as obvious as they are now, then the value of the shares would naturally increase. Today, many experts estimate MySpace at tens of billions of dollars, but a year ago, few would dare to make such an assessment.
Nevertheless, the purchase of MySpace may well turn into one of the most scandalous deals in US history.
What happens? After last year’s deal, the MySpace portal magically turned into a super profitable company and began to bring huge amounts of money to its new owners?
In such a situation, the question naturally arises: wasn’t the price for which the company Intermix, the owner of MySpace, bought was too low? One of the founders of Intermix and its former CEO, Brad Greenspan, says it is. From the very moment of the transaction, he made statements that the cost of Intermix was clearly underestimated, and the real price of the company was at that time tens of billions of dollars. The people who cranked the deal, according to Greenspan, deceived Intermix shareholders.
Although after the deal with News Corp. more than a year has passed, but Brad Greenspan continues his struggle to this day. The other day, he published a large report in which he detailed all his arguments.
')
According to Greenspan, the fair price of Intermix was $ 20 billion. He claims that insiders knew that the cost of business would soon come close to $ 20 billion, but the deal was still made as quickly as possible and at a reduced price. Nobody explained to shareholders that the company's revenues are growing at 1200% per year. They were persuaded to approve the deal as quickly as possible.
Thus, Intermix shareholders (and the largest of the private shareholders, Brad Greenspan himself) were deceived. Responsibility for this scam rests on two top managers who organized the fraud: this is Richard Rosenblatt (Richard Rosenblatt) by Intermix and Ross Levinson (Ross Levinsohn) by News Corp. They deliberately prevented the start of a standard auction and did not inform shareholders of the proposals of competitors.
For all these reasons, Greenspan insists that it is urgent to initiate an investigation before the evidence of fraud has been destroyed. In February 2006, Greenspan filed a lawsuit against News Corp. He believes the deal should be canceled, and Intermix and the MySpace portal should be withdrawn from News Corp.
True, there are several weak points in the argument of the former director of the company. The main thing is that Intermix at the time of purchase was a public corporation and its shares were quoted on the stock exchange. So, the market capitalization was lower than the price paid by News Corp. If such excellent business prospects were as obvious as they are now, then the value of the shares would naturally increase. Today, many experts estimate MySpace at tens of billions of dollars, but a year ago, few would dare to make such an assessment.
Nevertheless, the purchase of MySpace may well turn into one of the most scandalous deals in US history.
Source: https://habr.com/ru/post/4489/
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