US music video site Vevo is in talks to control the ailing social network in exchange for a stake in a new venture.
As reported by the Guardian, a strategic review by investment bank Allen & Co last month presented options to sell or spin off Myspace before the end of the company's financial year in June.
Vevo, which is owned by several of the world's biggest music labels is said to have turned down the chance of buying Myspace outright.
Myspace could still be part of a wider deal with Vevo, which is only available in the US but is set for a launch in the UK over the next few months.
Sony and Universal, who are the main shareholders in Vevo, are also investors in Myspace Music.
It is thought around 20 other parties apart from Vevo have been invited to bid for the social networking website, with News Corp trying to achieve a price tag of more than $100m.
Myspace lost 10m unique users in January according to comScore figures, falling from 73m to 63m unique users, though there are still around 30m UK users still registered on the site.