AOL inked a deal to buy the Huffington Post news website for $315 million, an indication the company is looking to build its reputation as a major media company and build its user media base into content.
The purchase announced Monday is the most aggressive move yet by AOL CEO Tim Armstrong as he works to completely reshape the once-great Internet Company and increase its presence in online news and advertising. The deal is the biggest purchase made under Armstrong, who left Google to lead AOL’s turnaround.
The Huffington Post is one of the top sites for global news and current events and attracts 25 million visitors from the U.S. every month. It has built its success by bringing together news from a variety of media sources on topics ranging from politics to food to style. The site combines content aggregation with original articles by its small staff and posting by celebrities from a range of fields.
However, just as important as what the deal means for the site is what it means for co-founder Arianna Huffington, who will move into a spot on AOL’s management team. Huffington will oversee AOL’s growing lineup for content services, including the technology sites TechCrunch and Engadget, mapping service MapQuest and local news network Patch.com.
The purchase price is high, according to some analysts, but Clayton Moran of Benchmark Co. said the cost isn’t a big hit for the company, especially since it help AOL to finally take on the role of an online media company.
The price is “the hiring fee to get Arianna,” tech analyst Rob Enderle said. He described the deal as coming “out of left field,” but he felt the move “could put AOL back on the map.”