CNET reports Best Buy gobbled up Napster for $121 million. The retailer plans to use Napster to reach consumers looking to explore digital music and other forms of entertainment over a variety of electronic devices.
The two companies on Monday announced a merger deal in which Best Buy is to launch an all-cash tender offer for outstanding Napster shares at $2.65 apiece, with the full acquisition valued at $121 million. That total value represents $54 million net of approximately $67 million in cash and short-term investments in Napster as of June 30.
In Napster, retail heavyweight Best Buy is getting itself a one-time contender in the field of online entertainment. A decade ago, Napster was virtually synonymous with digital music--a notoriety that earned it the wrath of the music industry. That contributed to its demise, along with the rise of alternatives such as Kazaa and LimeWire.
Napster eventually reinvented itself as a subscription service, and it says it now counts 700,000 subscribers.