BestBuy To Pay $121 Million for Napster

Allen Stern reports today that BestBuy has announced its decision to acquire music service Napster for $121 million. According to the press release, the acquisition amount is based on the price of $2.65 per share in cash. The transaction is scheduled to close by the end of the year.

By paying the $121 million BestBuy acquires approximately 700 thousand subscribers to Napster service, the web platform itself and Napster mobile solutions as well. Napster CEO and other key executives have agreed to continue managing Napster as BestBuy employees after the acquisition is completed.

BestBuy intends to use Napster to reach the music service subscribers with BesiBuy’s new digital entertainment offerings and probably to market some new devices “that enable them to access their content wherever, whenever and however they want”. It sounds quite intriguing and it will be interesting to see how Napster will develop with BestBuy as the new owner.

It is very interesting if BestBuy will continue working on Napster as a separate business to generate its separate revenue stream or if it will be used mainly to promote sales of hardware in various BestBuy stores.