The latest chapter in the MySpace saga is just too hilarious to pass up. I make no secrets of the fact that I’m not a big fan of MySpace, but I have to admit it’s popularity, the fact that literally everyone and their mother is on the site (seriously, lots of moms) and even I humbly admit that I have a profile. But I don’t use it!
Anwyay, now the founder of MySpace, Brad Greenspan, released a report on Thursday claiming that shareholders of MySpace were ripped off when the social networking site was sold for $580 million to Rupert Murdoch’s News Corp. last year. Whether it’s just sour grapes for having sold an entity that’s grown massively since the sale or a legitimate complaint, no one’s entirely sure yet, but Greenspan certainly believes that the deal to sell the company was rushed and shareholders were deliberately misled into thinking that the company was worth far less than it was, and didn’t hold the growth potential that it did.
Quoting the PC Mag article on the topic:
Greenspan released the report on Freemyspace.com. It claims that Intermix chief executive officer Richard Rosenblatt knew that Myspace was well on its way to becoming worth far more than but rushed the sale, misleading shareholders to believe that the company was not worth more, so that he could personally make $20 million.
“[It is] one of the largest merger and acquisition scandals in U.S. history,” Greenspan said in his statement. “Deliberate steps were taken to withhold and manipulate information; money was improperly gained and laws were broken. It is my hope that regulatory bodies will begin their investigations quickly before evidence is destroyed.”
Greenspan estimates that the company is now worth approximately $20 billion. A spokesperson for Fox Interactive Media, which owns News Corp., issued a response to the report on Thursday.
“It’s unfortunate that Mr. Greenspan continues to issue press releases complaining about a deal that many industry experts initially believed was a risk for News Corp to take,” said the spokesperson. “We’ve strategically built this business since the acquisition and are just now beginning to realize real financial value. This is simply a case of sour grapes making for loud complaints.”
Well well. Looks like this one will heat up quite nicely. The lawsuit is pending, and it looks like neither side is about to settle or take care of their business out of court, so we might see some press coverage and some spectacular court action over this in the near future.
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