AOL Acquiring HuffPo For $315 million; Huffington To Head All Content

AOL (NYSE: AOL) has acquired Huffington Post for $315 million, approximately $300 million in cash. As part of the deal, co-founder Arianna Huffington will be president and editor-in-chief of The Huffington Post Media Group. The new unit will house all Huffington Post and AOL content, including Engadget, TechCrunch, Moviefone, MapQuest, Black Voices, PopEater, AOL Music, AOL Latino, AutoBlog, Patch, StyleList, and other sites.

The news was announced as Huffington and AOL CEO Tim Armstrong were flying back from the Super Bowl, an AOL rep told paidContent. The announcement on HuffPo included her version of events.

The purchase is meant to help provide the scale AOL needs to grow its content and advertising business. In particular, AOL claims that The Huffington Post Media Group will reach 117 million Americans and 270 million globally. Although it won’t necessarily answer critics who describe much of AOL’s content as “piffle” it should provide better organization and scale to the various sites that AOL has acquired the last few months, including TechCrunch. In her post, Huffington ticked off the ways it helps HuffPo — local, original video, more verticals.

Although Huffington is now Mike Arrington’s boss, we’re told that this deal shouldn’t affect his agreement or those of others. Armstrong referred to his strategy of making sure the founders or leaders of acquired companies stay with AOL following deals as recently as Wednesday’s earnings call. The integration of the two companies is expected to take 45 days, following a review of the two teams.

Jon Brod will head the AOL side of the integration, according to an internal memo posted by TechCrunch. The HuffPo group will include AOL Media, AOL Local & Mapping (Brod’s group) and AOL Search. AOL Media head David Eun is mentioned in the memo as a part of the integration.

Meanwhile, AllThingsD‘s Kara Swisher reports that one person who won’t be joining the team is Greg Coleman, HuffPo’s president and chief revenue officer. Coleman has been credited with doubling HuffPo’s revenue a year after joining the company. Incidentally, Coleman was briefly the head of AOL’s ad sales. Coleman was hired by AOL’s previous regime and was ousted after Armstrong came in as CEO. Also leaving: HuffPo CEO Eric Hippeau.

In an interview with Swisher at the Super Bowl, Armstrong, seated next to Huffington, said that this merger reflected “the future of the content space.” Huffington said that she and Armstrong met in November to discuss a deal, just around the time that the company said HuffPo was reaching profitability. (Video is available here)

At $315 million, the deal is five times the $60-to-$65 million HuffPo projects in revenue for 2011. Coleman told us last month that HuffPo doubled revenues last year and he thought it could double again this year.

HuffPo raised $37 million from investors including included Oak Investments, Greycroft Partners, Bob Pittman and Softbank.