When good deals go sour.
Michael Birch, the co-founder of Bebo, tweeted this week that he had bought back his social networking website from AOL for just $1m. In 2008, when Bebo was all the rage among teenagers, AOL paid $850m (£557m) for it. But AOL is not the first to make a terrible top-of-the-market purchase.
MySpace: After long dismissing the money-making prospects of the internet, Rupert Murdoch finally opened his wallet in 2005 and snapped up MySpace for £580m, which, at the time, was the bright new thing of social networking. But then Facebook came along and, in response, the online world collectively "unliked" MySpace. In 2011, Murdoch's News Corp sold it for just $35m (£23m).
Friends Reunited: For a brief period in the first half of the noughties, it was hard to walk through an office and not spot at least one person surreptitiously looking at the Friends Reunited website. The world, it seemed, was busy hunting down – or avoiding – people they had last seen at school. ITV liked the numbers – 15 million members by 2005 – and secured the company that year in a deal worth £175m. But, as with MySpace, it didn't predict the arrival of the all-conquering Facebook. Suddenly, we had an easier and better way to stalk people we once knew. In 2009, ITV offloaded Friends Reunited for £25m to the publisher DC Thompson. In 2011, the new owner admitted the site was now worth just £5.2m.
EMI: In 2007, the record label was bought for £4.2bn by private equity firm Terra Firma Capital Partners. Even though the record industry was seeing its traditional sales threatened by online music, EMI still boasted a roster of highly bankable stars such as Paul McCartney, Pink Floyd, Rolling Stones, Radiohead and Joss Stone. But Terra Firma's restructuring plans led many artists to flee EMI. In 2011, Citigroup, the US bank that had helped to finance Terra Firma's purchase of EMI, took control of the music company and immediately wrote off £2.2bn of its debt, leaving Terra Firma with a £1.75bn loss. EMI has subsequently been broken up and sold off to rivals.
Lonely Planet: In 2007, BBC Worldwide, the commercial arm of the BBC, raised eyebrows when it bought the backpacker's travel-guide publisher of choice in a deal worth £130m. The BBC Trust, the broadcaster's governing body, strongly criticised the BBC earlier this year when it sold Lonely Planet for £51.5m, a £80m loss. The economic crash in 2008 has led many people to cut back on trips abroad and online rivals have sapped some of Lonely Planet's market share.
Andy Carroll: Football is littered with examples of expensive transfer deals that turned sour, but it's hard to beat Liverpool's purchase of the England striker Andy Carroll. In January 2011, Liverpool paid £35m for him. He went on to score just 11 goals for the club in 58 appearances before being sold to West Ham earlier this year for £15m. That works out at £1.82m per goal.
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