News Corporation has sold Myspace to digital media company Specific Media and singer Justin Timberlake, who will take an ownership stake and develop the creative strategy for the company.
As part of the agreement, Rupert Murdoch's News Corp will take a minority equity stake in Specific Media. Additional terms of the agreement are not being disclosed, but reports suggest the sale could have been for as little as $38m (£22m).
This falls far below the $580m News Corp paid for Myspace in 2005. Earlier this year, the company said it was looking to sell the ailing site, which has struggled to compete with rivals such as Facebook and Twitter.
Justin Timberlake said: "There is a need for a place where fans can go to interact with their favourite entertainers, listen to music, watch videos, share and discover cool stuff and just connect. Myspace has the potential to be that place.
"Art is inspired by people and vice versa, so there's a natural social component to entertainment. I'm excited to help revitalise MySpace by using its social media platform to bring artists and fans together in one community," he added.
Specific Media and Timberlake plan to evolve Myspace into a digital destination for shows, video content and music.
The company also intends to run advertising campaigns across the platform in a bid to help brands go viral by encouraging users to share their favourite advertisements with friends.
Creative ideas and vision
Brothers Tim, Chris and Russell Vanderhook founded Specific Media in 1999. "We are thrilled about the opportunity to rebuild and reinvigorate Myspace," said Tim Vanderhook, CEO of Specific Media. "We look forward to partnering with someone as talented as Justin Timberlake, who will lead the business strategy with his creative ideas and vision for transforming Myspace.
Specific Media and Timberlake plan to unveil their vision for the site in a press conference later this summer.
Timberlake has some experience working as an entrepreneur, having co-created denim lifestyle brand William Rast, launched a spirits company with 901 Silver Tequila, and founded a golf course. But his experience of digital media is unclear.