A SOCIAL networking site founded in Barnet was sold at a £150 million loss yesterday.

Friends Reunited, created by Steve and Julie Pankhurst in the spare room of their semi-detached house, was offloaded by ITV for £25m - after being bought for £175m in 2005.

ITV chairman Michael Grade, who once described Friends Reunited as “one of the great undersung jewels in the crown" and "one of the most important bits of ITV”, denied responsibility for the loss.

He said: “ITV bought it, this management team did not buy it — let’s be very clear on that.

“This was a business that we inherited from a previous management. We have moved on.”

In 2005, only a handful of British internet users had heard of Facebook. Today, it has 200 million users, compared to the three million who use Friends Reunited.

Brightsolid, which made the deal at 5am yesterday, said it was buying the company only to get its hands on Genes Reunited, the sister site that deals with family histories.

Chris van der Kuyl, chief executive of Brightsolid, said: “We know Genes Reunited very well. The fact that we could grab it excited us.”

ITV was hoping to syndicate its television content with the website to encourage people to sign up. Ideas included a version of Blind Date that would matchmake old school friends and a show in the mould of the BBC's "Who Do You Think You Are?", which would channel viewers to Genes Reunited.

But these collapsed due to opposition from ITV's production arm, the decline of the internet advertising market and the rise of web competitors such as Facebook and MySpace.