Spotify will pay as much as $195 million to acquire Bill Simmons’ The Ringer, the company disclosed Wednesday in a regulatory filing.
The Stockholm-based audio streaming giant said that the price to purchase the sports and pop culture company will total between 130 million euros and 180 million euros ($141 million to $195 million, based on the current exchange rate), a portion of which will be deferred. This implies that The Ringer’s purchase price could go up by nearly $55 million based on hitting performance-driven incentives in the coming years. The final price is subject to the deal closing.
Spotify announced on Feb. 5 that it would acquire The Ringer in a move to build out the sports vertical of its podcasting business. Its deal for the Los Angeles-based firm will see all 90 Ringer employees become a part of Spotify. In addition to a 30-show podcast slate, the company also operates the website Ringer.com and the production shingle Ringer Films. Spotify expects the deal to close in the first quarter.
in 2019, Spotify paid nearly $400 million to acquire the podcast studios Gimlet and Parcast and the podcast tech provider Anchor. If it pays the maximum on its deal for The Ringer, Spotify will have paid around $590 million on acquisitions that aid in its pivot into an audio-first streaming platform.
So far, that investment has paid off. The company, which has 124 million paid subscribers and 271 million total monthly active users, recently disclosed that podcast consumption hours were up 200 percent year-over-year during the final three months of 2019. Spotify also said podcasts were helping drive increased overall engagement and retention to its product. More than 16 percent of Spotify’s monthly active users now engage with podcast content.
With The Ringer, Spotify adds a slate of culture-centric shows, from The Bill Simmons Podcast to movie-themed The Rewatchables to food-oriented The Dave Chang Show. The companies previously teamed up on the daily series The Hottest Take. On Wednesday, they also announced plans for Spotify Original podcast Music Exists with hosts Chuck Klosterman and Chris Ryan.