“Insiders say the German media giant is close to inking a $16 million pact to buy the gasping pioneer of music file-sharing. Despite persistent predictions of its demise, online music pioneer Napster seems increasingly likely to live on. But not as a solo act. According to insiders, the beleaguered music-sharing site is close to a final deal that would see it acquired by Bertelsmann for about $16 million.
“Bertelsmann Wants Napster for Its Own”
“The agreement, which has been approved by the Napster board and a majority of shareholders, includes pledges by Bertelsmann to forgive its $85 million loan to Napster as well and pay some $11 million to creditors, say knowledgeable insiders. The German entertainment giant is still reviewing the final details, and a decision is expected soon.
“The acquisition would come just in time for Napster, which is struggling to eke out its dwindling cash reserves. On Apr. 10, it laid off a further 30 employees to cut its burn rate, leaving the Redwood City (Calif.) upstart with a workforce of about 70. Through a company spokesperson, Napster CEO Konrad Hilbers declined to comment for this story. In an e-mail, Hilbers said the buyout “is not done at this stage,” and insiders say Bertelsmann hasn’t signed off on all the details.”
Click here for the full article at BusinessWeek.com.
