In a major and rather unexpected deal, AOL (NYSE: TWX) is buying social net Bebo for $850 million in cash. Rumors had swirled around Bebo of either an acquisition or new financing for weeks, but few anticipated AOL as the suitor. AOL will get Bebo’s 40 million members and 80 million unique users, its core 13-to-24 demographic and a growing line in both original TV production and hosting broadcasters’ content. This comes as AOL completes its transition from an access business to an ad-funded content and community player. More at Paidcontent.co.uk:

—BREAKING: AOL Buying Bebo For £417 Million
—AOL-Bebo Call: Bebo Hadn’t Planned Sale; All About ‘Engagement Marketing’; Birches Seem To Step Away
—Bebo’s History In Links
—AOL-Bebo: Balderton VCs Reap $140 Million From Acquisition