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Meredith Corp., the publisher of brands like People magazine, Entertainment Weekly and InStyle, has sold to Dotdash, a digital publishing subsidiary of Barry Diller’s IAC, in a deal valued at $2.7 billion, the companies said Wednesday.
The deal is expected to close Dec. 1, with the newly combined company called Dotdash Meredith and led by Dotdash CEO Neil Vogel.
“We admire the consumer’s trust in Meredith’s more than 40 brands when it comes to essential life decisions, and we believe true and reliable content created by talented writers, editors and photographers, backed by real brands, has a very bright future across all platforms,” Joey Levin, the CEO of IAC, said in a statement.
Levin added: “Combined with Dotdash’s ability to deliver readers fresh, unbiased content on any topic, together we can offer uniquely engaged audiences to advertisers and partners — based not on a reliance on private information or personal history but on relevancy to the content they’re consuming and a deep understanding of their needs. No one will do this better than Dotdash Meredith.”
The sale comes four years after Meredith Corp. purchased Time Inc. for $2.8 billion with backing from Charles and David Koch. Since then, Meredith has shed a number of Time Inc.’s major assets, including Time magazine, Fortune and Sports Illustrated. In May, the company also sold its local TV stations to Gray Television for $2.4 billion. IAC, meanwhile, acquired Dotdash — formerly known as About.com — and its portfolio of 14 brands in 2012 from The New York Times Company for $300 million in cash.
The Meredith acquisition will bolster IAC’s portfolio after the company separated from Match Group — the parent company for dating apps like Tinder and Hinge — and spun off Vimeo, the video company that now operates as a publicly traded, separate venture. The Meredith titles will join Dotdash’s Verywell, Investopedia, The Spruce, Serious Eats and Byrdie, among others, which reach about 100 million users per month, according to the company.
Cowen analyst John Blackledge wrote in a research note after first reports of a possible deal that “Meredith’s properties would complement Dotdash’s existing online publishing business, which generated $263.7 million of revenue and $86.0 million in earnings before interest, taxes, depreciation and amortization for the 12 months ending with the second quarter of 2021, indicating that Meredith’s business would add substantial scale to IAC’s online publishing presence.”
The move to purchase a magazine publisher may seem surprising for a company led by Diller, who in 2013 described his decision to purchase Newsweek as a “mistake.” It also wasn’t until this year that Meredith’s digital advertising surpassed its print revenue for the first time in the company’s history. Whether that shift in revenue will sustain remains to be seen, but it’s expected that the merged company will keep its efforts focused on digital.
“The opportunities are limitless,” said Vogel, the Dotdash CEO who will lead the combined company. “Meredith can step into its digital future and together we can define our next chapter as Dotdash Meredith.”
Georg Szalai contributed to this report.
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