MySpace Signs Agreement To Acquire iMeem

On Monday we broke the news that MySpace was in late stage negotiations to acquire music service iMeem. Those negotiations are now concluded, we’ve heard from multiple sources, and an agreement has been signed. MySpace will acquire most of the assets of iMeem for a purchase price of around $1 million in cash.

$1 million isn’t the “real” purchase price for the company. Some assets are being left behind, say our sources, including millions of dollars in accounts receivable plus some other cash. All or most of these assets, plus the purchase price, will be used to pay off some of the debt iMeem has accumulated.

About half of iMeem’s 55 employees will now work for MySpace. The rest, we’ve heard, will be looking for a new job.

One question that’s still unanswered – will the iMeem service live on? That’s completely up to the music labels, say our sources. iMeem’s deals with the labels terminate on this acquisition. The service is running at breakeven, we’ve heard, so MySpace may push to keep iMeem alive.

One thing is clear – MySpace is getting the iMeem assets for an absolute steal. I wouldn’t be surprised if other bidders suddenly get interested in iMeem and try to disrupt the deal before it actually closes.

MySpace and iMeem won’t comment on this story.