AOL has $315 million? Who knew???

[PC]

The Huffington Post announced Monday that AOL will acquire the website for $315 million.

Arianna Huffington, for whom the site is named, will become the president and editor-in-chief of the newly created Huffington Post Media Group.  The media group will encompass some of AOL's most popular brands such as Engadget, TechCrunch, Moviefone, MapQuest and StyleList. The combined network will supposedly reach up to an audience of 270 million.

AllThingD, who initially broke the news late Sunday night, pointed out that Huffington's project only recently became profitable and that the buying price is five times the website's projected annual revenue of $65 million. The bulk of the $315 million deal was done in cash.

In recent years, AOL has aggressively pursued major online properties and now employs over 1,000 writers. Three sites from the Technorati Top 5, a site that measures a blog's influence and traffic, are now AOL properties. The deal, "will create a next-generation American media company with global reach that combines content, community, and social experiences for consumers," AOL CEO Tim Armstrong said in a statement.

The Huffington Post originally launched as an alternative to sites like The Drudge Report in 2005. Over the years, it has featured contributors such as Barack Obama, Hillary Clinton, Norman Mailer, and Madeline Albright. It appeared on TIME's 2009 list of best blogs, coming in second to Talking Points Memo.

Huffington wrote in a post that Tim Armstrong, AOL's CEO and current chairman, approached her with the proposition earlier this year. In a dramatic flourish, the deal was finalized at the Super Bowl. She notes it was a momentous way to mark the occasion – indeed, it was her first Super Bowl ever. Chances are it won't be her last.

http://newsfeed.time.com/2011/02/07/aol-acquires-huffington-post-for-315-million

[Obed_Marsh]

Arianna Huffington is annoying even when I agree with what she is saying; nails on the chalkboard annoying.

[PANatsFan]

I think she's an amazing woman and the HuffPost is saving journalism from idiocy like that tablet newspaper.

[houston-nat]

I think she's an amazing woman and the HuffPost is saving journalism from idiocy like that tablet newspaper.

Except the website now has a "Divorce" tab at the top of every page. If anyone is saving journalism, it's al-Jazeera.

[PANatsFan]

Except the website now has a "Divorce" tab at the top of every page. If anyone is saving journalism, it's al-Jazeera.

Insert notsureifserious.jpg joke

[houston-nat]

Insert notsureifserious.jpg joke

The first sentence is factually accurate.
The second sentence, I was serious when I wrote it, but now I'm like 50/50

[spidernat]

I think she's an amazing woman and the HuffPost is saving journalism from idiocy like that tablet newspaper.

Shocking!  

[houston-nat]

I think she's an amazing woman and the HuffPost is saving journalism from idiocy like that tablet newspaper.

Also, Neil Patrick Harris tweeted that the tablet newspaper is awesome. notsureifserious.jpg

[PANatsFan]

Shocking! 

There's a bunch of very smart conservatives on that site, but you have to actually be willing to look at the site to find that out.

[Ali the Baseball Cat]

Time Warner eat yer hearts out

[Potomac Cannons]

I think she's an amazing woman and the HuffPost is saving journalism from idiocy like that tablet newspaper.

Really?  I'd say 2 years ago HuffPo turned into that same yellow/tabloid journalism they were trying so hard not to be.  They're insufferable now.

[MarquisDeSade]

Is this a LBO? 

[tomterp]

Is this a LBO? 

It's not clearly apparent either way.  AOL had $623m in cash at 9/30, has yet to publish their Q4 results, but have already indicated ad revenue is down 29% for the Q.

The deal will cost them $300m cash -presumably they could write a check but would leave them a thin cushion, so I would say that most likely they will be taking on some debt, but not nearly the full amount.

Here's their press release:  http://www.sec.gov/Archives/edgar/data/1468516/000119312511025071/dex991.htm

And they had an investor call this morning, maybe they discussed it: 

AOL will host a conference call with Chairman and CEO of AOL, Tim Armstrong, CFO of AOL, Arthur Minson and The Huffington Post Co-Founder & Editor-in-Chief, Arianna Huffington to discuss the transaction at 8:00 a.m. Eastern time today. To listen to the call via webcast and access prepared remarks regarding the transaction, please visit our website at ir.aol.com and click on the link titled “AOL Inc. Conference Call” located under “Events & Presentations.” The prepared remarks by Arthur Minson regarding the financial impact of AOL’s acquisition of The Huffington Post will be available beginning at 7:00 a.m. Eastern time today. We recommend going to the website at least 15 minutes prior to the start of the webcast to register, download and install any necessary software. Instructions for accessing and registering for the webcast will be available at ir.aol.com beginning today. Visitors will also be able to listen to an archived copy of the webcast at ir.aol.com by clicking into “Events & Presentations” for up to 1 year following the event.