Will Facebook acquire and catch location-startup Hot Potato?

Facebook is rumored to be closing in on a deal to acquire the location-based app Hot Potato, according to TechCrunch.

The app, which is centered around events and things to do, lets you share photos and status updates around concerts, stories or TV shows. The problem is, since it launched at TechCrunch’s real-time CrunchUp last November, it hasn’t quite taken off in the same way that other location services has.

The team is talented and is close with many longtime Facebook employees like the social network’s former design strategy lead Aaron Sittig.

Facebook also has a penchant for acquiring extremely talented teams and integrating them into other projects like the company did with FriendFeed’s Bret Taylor, who is now chief technology officer, and Blake Ross and Joe Hewitt, who came to the social network in its first acquisition of Parakey a few years back. The acquisition would follow on the heels of Facebook’s purchases of NextStop, ShareGrove, Divvyshot and Octazen Solutions.

Hot Potato raised $1.42 million from RRE Ventures and other angels including longtime Facebook senior platform manager and Path founder Dave Morin, Ron Conway and Chris Dixon. Silicon Alley Insider and and AllThingsD report that the acquisition price may range from $10 to 15 million, which sounds a tad high for a tiny team without a ton of traction.

Facebook wouldn’t comment on the matter.

“Our response is that we don’t comment on market rumor and speculation,” said spokesperson Jonny Thaw.

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