AOL’s Inflated Price for HuffPo Might Make Investors Think Twice

By
Photo: Michael Kovac/Getty Images

At first, it seemed as though AOL's $315 million decision to bet big on content — and Arianna Huffington — was poised to set off a wave of mergers and acquisitions from companies like Yahoo and Google. But the fact that AOL paid 30 times HuffPo's expected earnings this year could end up having the inverse effect. Business Insider's source says it may cool off deal flow because of the disconnect between "seller expectations and what buyers are willing to pay." Maybe the start-ups whose chances of getting acquired just dried up should launch their own version of "Arianna, Can You Spare a Dime?" [BI]