Dan Primack

The latest on private equity, M&A, deals and movements — from Wall Street to Silicon Valley

AOL values distribution over creation

September 28, 2010: 2:59 PM ET

Tweet of the day comes from @pkafka, who just wrote:

If WSJ $30M TechCrunch # is correct, than AOL values company that doesn't own content 2x more than one that makes it.

Kafka, a media writer with All Things D, is referring to the fact that AOL today announced two acquisitions: TechCrunch (ubiquitous tech blog) and 5Min (syndication middleman for online video).

Pricing details for TechCrunch have not yet been disclosed, but estimates have ranged from $25 million to $40 million. Unclear if those estimates include earn-outs, which almost certainly are part of the deal. Expect a definitive figure when AOL next files with the SEC.

AOL also didn't disclose pricing for New York-based 5Min, but a source close to the company pegs the price-tag at $65 million in cash. Decent return for theĀ 5Min's VC backers, who plugged in $13.9 million over three rounds (including $400k seed deal).

But back to Kafka's point: TechCrunch makes things. Not just market-moving tech news, but also conferences that are among the industry's best. 5Min, on the other hand, collects third-party videos and distributes them to content-hungry websites.

So to my bosses at Fortune: Rather than producing original content, I'd like to interest you in some stuff that other people wrote. Can I have a raise?

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About This Author
Dan Primack
Dan Primack
Senior Editor, Fortune

Dan Primack joined Fortune.com in September 2010 to cover deals and dealmakers, from Wall Street to Sand Hill Road. Previously, Dan was an editor-at-large with Thomson Reuters, where he launched both peHUB.com and the peHUB Wire email service. In a past journalistic life, Dan ran a community paper in Roxbury, Massachusetts. He currently lives just outside of Boston.

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