

Myspace, once the dominant social networking site on the Internet but now an afterthought to Facebook, will be sold to Specific Media in a deal worth $35 million in cash and stock, a person familiar with the matter said.

The acquisition by the Irvine-based advertising network is expected to be completed Wednesday.

News Corp., which acquired Myspace in 2005 for $580 million as part of a bold digital strategy, plans to retain a small stake in company. The media conglomerate had hoped to fetch as much as $100 million for the site, which has been steadily shedding users and advertising revenue over the last several years.

The sale marks a significant fall from grace for Myspace, which once commanded a billion-dollar valuation and was the premier online hangout for musicians, actors and their fans to interact. But the site peaked in popularity in October of 2008 with 76.3 million users. The number of monthly visitors has since dwindled to 35 million in May, according to ComScore Digital Analytix.

Other potential bidders for the site included Myspace co-founder Chris DeWolfe, and an investor group that was courting a personal investment from Activision Blizzard Inc. Chief Executive Bobby Kotick.

The little-known new owner Specific Media was founded in 1999 by Tim Vanderhook and his brothers, Chris and Russell. The firm helps companies distribute advertising online, on mobile devices and on Internet-connected televisions.

Specific Media wants to return the site to its roots as a place for music fans to discover new bands and songs, according to the person familiar with the matter who asked not to be identified because the negotiations are private.

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-- Dawn C. Chmielewski

File photo: News Corp. Chairman Rupert Murdoch at a Myspace news conference in 2007. Credit: Associated Press.