September 16, 2008
Electronics retailer Best Buy says it will purchase the online music
download site Napster for approximately $121 million. The company
said the transaction is subject to customary closing conditions,
including the tender of a number of Napster shares that constitutes a
majority of Napster's outstanding shares of common stock.
Napster was once considered a virtual outlaw by the music industry. It's peer-to-peer technology allowed Internet users to upload and download mp3 music files without payment.
Following a court ruling against Napster, the site became a paid subscription music service, with full royalties paid to artists. It now has some 700,000 subscribers who pay $12.95 per month for unlimited access to millions of songs.
Best Buy said it plans to keep Napster as a stand-alone business, with its executive suite mostly intact. The company is headquartered in Los Angeles.
Best Buy said the transaction is expected to close during the fourth calendar quarter. It said the transaction has been unanimously approved by the board of directors of Napster, and Napster's directors and executive officers have agreed, in their capacities as stockholders, to tender their Napster shares and otherwise support the transaction.
