Rupert Murdoch is facing a challenge to his attempted acquisition of Internix. News Corp, who has made a $580M offer for Intermix, the company that runs social networking site MySpace.com, has received a challenge from Intermix's founder.
Brad Greenspan, who owns 10% of Intermix and founded many of the sites owned by Intermix, has stated that he has the backing of private equity investors to buy half of Intermix's shares for $13.50, a considerable premium on News Corp's offer of $12.
This throws the Intermix board into a tricky dilemma. Brad Greenspan left acrimoniously in 2003, presumably disagreeing on strategy with many of the existing board members. His offer looks better on paper, should it turn into reality, but News Corp may well be a better strategic fit.
News Corp, in turn, now faces the challenge of whether they will need to pay more to ensure their ownership of Intermix. And Intermix is central to Murdoch's much touted internet acquisition spree and associated strategy. Murdoch will hate paying up, but he may have to.
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