Michael Birch, who founded the social networking site Bebo with his wife Xochi in 2005, has sold the business for £419m.
The social networking site which is popular among teens has been purchased by the American internet provider AOL.
Rumours of the exit have been circulating since the company appointed Allen & Co. as its adviser a few weeks ago and Bebo has been high on the target list of many acquisitive players since its UK user numbers surpassed MySpace's last year.
For a while it was the UK’s leading social network, although it has since been overtaken by Facebook. Nevertheless, it has a total membership of more than 40 million users worldwide and is ranked number one in Ireland and New Zealand, and number three in the US.
Birch, who is believed to be remaining with the business, has grown the company into a 100-strong operation with offices in the London, San Francisco and Austin, Texas.
For now Birch has chosen to remain circumspect on the deal but Bebo president Joanna Shields described it as a ‘natural progression’ for the fast-growing network.
“AOL understands the shifting dynamics of the web and has clearly demonstrated its commitment to leveraging the ever-increasing power of social networks,” she said.
“With one and the same vision in this area, it was a natural progression for Bebo to join AOL, and we look forward to working together to continue to expand the online social experience globally.”
© Crimson Business Ltd. 2008
