UPDATE 2-AOL to acquire popular tech blog TechCrunch

* AOL to acquire tech network TechCrunch

* Agreed to purchase for about $30 mln - source

* Arrington to stay on in multi-year agreement (Adds financial terms, executive comments, background)

NEW YORK, Sept 28 (Reuters) - AOL Inc AOL.N said it agreed to acquire the popular technology blog and network TechCrunch as it tries to remake itself into a Web entertainment and news powerhouse.

The value of transaction is about $30 million, according to a source familiar with the deal.

AOL will buy the influential technology blog as well as its conference division from founder Michael Arrington.

“We are still investing in content areas and ... adding more content brands to our portfolio,” said AOL Chief Executive Tim Armstrong about the acquisition.

Armstrong said that Arrington has a multi-year agreement with AOL. He also said Arrington will continue to run TechCrunch and that AOL will give it more resources.

AOL and TechCrunch announced the news on Tuesday during the TechCrunch Disrupt conference in San Francisco. <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ For a Breakingviews column: [ID:nN28168741] ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>

“I look forward to working with everyone at AOL as we build on our reputation for independent tech journalism and continue to set the agenda for insight, reviews and collaborative discussion about the future of the technology industry,” Arrington said in a statement.

AOL publishes approximately 80 sites including the tech blog Engadget, which had about 7.5 million unique users in August while TechCrunch had about 3.8 million during the same month according to comScore.

AOL was spun off from Time Warner Inc TWX.N last year after a disastrous decade-long marriage. Armstrong, who was a former executive with Google, was tapped to resurrect the 25-year-old company once synonymous with dial-up Internet access into one of the web's main content destinations.

Earlier Tuesday, AOL announced it had acquired video content syndication platform 5min Media for an undisclosed sum. (Reporting by Jennifer Saba; editing by John Wallace, Bernard Orr)