AOL Inc., the US internet company, has agreed to buy The Huffington Post – the rapidly growing free and left leaning news, lifestyle and analysis website started by Arianna Huffington, for $315 million (£194.9 million).
The deal – which was announced late Sunday night, is the most significant move by AOL to become advertising supported internet content provider and will create a media group that witnesses a total of 117 million visitors in the US and 270 million worldwide every month.
AOL is trying to turn around its struggling dial-up internet access business into a media and entertainment giant despite having trouble attracting investors and the deal can be seen as a successful step towards that goal by chief executive Tim Armstrong.
“The acquisition of The Huffington Post will create a next-generation American media company with global reach that combines content, community, and social experiences for consumers”, said Mr. Armstrong.
AOL has been trying to change its line of business and brought Mr. Armstrong – a former Google marketing executive, on board as its chief executive in 2009. “When people think about Google for search and Amazon for commerce, I think they’re going to end up thinking about AOL for content”, said Mr. Armstrong in a conference last year.
AOL’s business suffered a serious blow in the fourth quarter of 2010 when advertising sales and revenues from its dial-up business declined by 26 percent.
In her blog Arianna Huffington – the co-founder of the Huffington Post told that she’ll lead the newly formed The Huffington Post Media Group as its President and chief editor.
“By combining HuffPost with AOL’s network of sites, thriving video initiative, local focus and international reach, we know we’ll be creating a company that can have an enormous impact, reaching a global audience on every imaginable platform”, she maintained.
The deal, yet to be approved by US regulators, has been welcomed by both the boards and will seen AOL paying nearly $300 million in cash.
“The acquisition of The Huffington Post will create a next-generation American media company with global reach that combines content, community and social experiences for consumers”, Mr. Armstrong said in a statement on Sunday.
The Huffington Post has become one of the most popular news-site in the US since its inception in 2005.
“The Huffington Post has already been growing at a prodigious rate. But my New Year’s resolution for 2011 was to take HuffPost to the next level – not just incrementally, but exponentially”, said Ms Huffington in her blog.