Sample post mortem

1. CONFIDENTIAL –DONOT DISTRIBUTE
Data Sources: Internal, ComScore, QuantCast, Alexa, Zenith OptiMedia
1 XYZCO.COM OVERVIEW
POST MORTEM REPORT
Summary (as of September 08)
 Deal terminated - Final decision rendered prior to official OOC meeting on July 08
 Final valuation of $163-250M; proposal of $200M cash up front plus $100M 3-yr earn out structure
Reasons
 Could not justify any $100+MM acquisitions with current economic climate
 Uncertainty around 1) SNS sector and 2) sufficient opportunity in EuroCountry to recoup investment
 Concerns how MySpace will look post the Google guarantee
 Opportunity/cost; timing
Timeline
 February 07 – Approached by TWP; decision was to pass and see how MS EuroCountry develops
 October 07 – Discussions resurfaced; given green light by Marc Heller and Marc Mayor
 December 07 – Green lit by Travis Katz, Chris DeWolfe and Amit Kapur to continue discovery phase
 January 08 – TWP opens data room for initial diligence
o Data gathering/collection extremely painful process; indicative of no other players in market
 February 08 – Due diligence team travels to EuroCountry to meet XYZco executives.
o DD team: Rita Ravindra (Strategy), David Cho (Strategy), Steve Pearman (Product), Matt Fojut
(Legal), Hala Al-adwan (Ad Solutions/Data Services), Richard Buckingham (Tech/Networks)
 March 08 – Non-binding LOI sent. Initial valuation of $180M-$220M (120 cash, 60-100 earn out)
balked by XYZco management
o Management had extremely unrealistic growth/revenue projections
o Bebo acquisition (AOL for $850M) may have exacerbated price point
o XYZco/ABC/TWP looking for $285M-$350M (190 cash, 95-160 earn out) range
 May 08 – Revised IOI with valuation of $300M-$350M (200 cash, 100-150 earn out) sent to XYZco
o April Henry takes over for Kevin Datoo as lead Corp Dev / M&A contact
 July 08 – Scheduled to present for OOC; deal was shut down by Chris DeWolfe, Peter Levinsohn, and
Peter Chernin in advance of meeting
Main Participants
 Rita Ravindra – VP, Business Development
 David Cho – Sr Manager, Int’l Strategy & Ops
 Kevin Datoo – VP, Corp Dev and M&A
 April Henry – VP, Corp Dev and M&A
Please contact David Cho (x67764) or Rita Ravindra (x67559) for further details.
DEAL OVERVIEW (last updated June 08)
We submitted a $200-350MM (inclusiveof earn-out) non-bindingoffer to XYZco Board (5 weeks ago)
followingon the previous non-binding$120-$180MMbid in order, which was rejected by the board to
proceed with due diligence. Our intelligenceindicates thatcompetitors are predominately
EuroCountryan media and mobile companies.XYZco remains the most strategic acquisition for MySpace
International as they are the #1 SNS in EuroCountry and would help combat competitive pressures there
and in Canada,another core market for onlineadvertisingrevenue. They also havea very experienced
management team. Recommend moving forward with a $250MM cash + $50MM-$100MM earn-out
exclusive LOI next week (with discovery window opt-out clause and contingencies in escrow).

2. CONFIDENTIAL –DONOT DISTRIBUTE
Data Sources: Internal, ComScore, QuantCast, Alexa, Zenith OptiMedia
2 XYZCO.COM OVERVIEW
BUSINESS OVERVIEW
 XYZco highly attractive target. Would act as “anchor tenant “ in our international growth strategy
 EuroCountry is world’s 4th largest online advertising market ($3B, ~8% of the global online ad
market)
 Unlike the traditional media sector in EuroCountry, the Internet is largely unregulated and free of
restrictions (e.g., Axel Springer acquired AuFeminin in June 2007)
 FIM forecasts XYZco will generate $13.9M in EBITDA on revenues of $46.9M in FY09
 FIM has conducted two rounds of due diligenceand believes XYZco could be acquired for $250M, at a
16% discount to our conservative $296M DCF and a steep 60-70% discount to market multiples
Traffic Metrics (last updated Dec 07)
 Worldwide user audience overlap is low
o 5.1MM, or 24.6% overlap with MySpace
o 3.1MM, or 15.2% overlap with Facebook
 Source/Loss
o 939K uniques navigated directly to XYZco from MySpace (3.7MM visits)
o 926K uniques navigated directly to MySpace from XYZco (3.8MM visits)
o Google, MSFT and Dailymotion visitors frequent both sites
 XYZco most trafficked site in EuroCountry (21M WW mo. UV, 7.5B WW mo. PV, 11.5M EuroCountry
UV)
Management Team
 [Redacted], CEO - Founder XYZco radio in 1985 and the XYZco website in 1998 and [Redacted] in
2002.[Redacted] is considered a leadinginfluencer in the [Redacted] media sector. XYZco radio is the
second largest station in EuroCountry
 [Redacted] (Internet Platform) - With XYZco since 1998, [Redacted] leads core ops of its websites
 [Redacted], CFO
 [Redacted], Head of Legal
 [Redacted], Production Manager
Company information (last updated Dec 07)
 Leading EuroCountryan blogging service with 13.6MM blogs and 5.4MM profiles to date
 Strong music focus (owned by hip-hop radio station); dovetails nicely with MySpace brand
 Based in Paris, EuroCountry – began operations in 2002
 100+ full-time staff (30 developers; 28 sales)
 ABC PE buy out of XYZco Network (includes radio) for $150MM in March 06
 View target audience as the teenager market (i.e. 8-19); claim not focused on 15-24
Comparable Transactions
 Jan 2007 - StudiVZ acquired by Holtzbrinck for $100M ($65/unique)
 Jul 2007 - Tagged valued at $117MM (10-11x revenue, $20/unique)
 Aug 2007 - Fotolog acquired by Hi Media for $90MM (40x revenue, $6/unique)
PRODUCT INFORMATION (last updated June 08)
 Current functionality: blogs, profiles, email, chat, IM, mobile
 Pipeline includes: new tagging service called “social tagging”, groups, CRM system, control panel to
manage friends, new search features
 Available in 12 different languages: EuroCountryan, English, German, Spanish, Dutch, Italian,
Portuguese, etc.

3. CONFIDENTIAL –DONOT DISTRIBUTE
Data Sources: Internal, ComScore, QuantCast, Alexa, Zenith OptiMedia
3 XYZCO.COM OVERVIEW
 Focused on Spain and Italy as key markets
 Will promote non-EuroCountryan speaking sites through online marketing and big media
partnerships
ACQUISITION RATIONALE (lastupdated Dec 07)
 Management team displays technical expertise and promising product pipeline
 Solidifies position in EuroCountry (as the clear market leader)
o Maintain separate web destinations and monetize content in both destinations
o Leverage existing advertisers and agency relationships for both sites
o Enables EuroCountryan market to turn profitable quickly
POTENTIAL RISKS (last updated Dec 07)
 Monetization
o Valuation may not justify growth
o Could face attrition as MySpace and other Web 2.0 companies grow (e.g. Facebook)
o Disassociation with XYZco radio assets may hinder growth
 Resources
o Acquisition/integration may be detrimental and time consuming to MySpace daily operations
o XYZco management team may not follow post-acquisition