UPDATED: AOL has sold Bebo

AOL has sold Bebo to Criterion Partners for an undisclosed sum.

Bebo

AOL has sold Bebo to a private investment firm, following speculation that the company would either close or sell off the social networking site at some point this year.

Criterion Capital Partners has purchased the social networking service for an undisclosed sum.

"The young, highly active user base, revenue history, presence in countries throughout the world and solid technical infrastructure make it an attractive media platform both as a standalone entity and in the context of our broader investment objectives," said Adam Levin, managing partner at Criterion, in a statement.

Tim Armstrong, chairman and chief executive at AOL, added: "Criterion Capital Partners are specialists in facilitating growth plans and turnarounds, and are well placed to drive Bebo's effort to strengthen its foothold within the highly competitive social networking arena."

AOL bought the site more than two years ago for $850 million, but is now aiming to streamline its business since Time Warner spun it off last year.

The Wall Street Journal, citing people familiar with the situation, said the Bebo sale would be done at a price that "is a small fraction" of what AOL originally paid.

(Additional reporting by Maggie Holland, IT PRO)

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