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Two of the biggest players in digital media are merging.
Vox Media — which owns New York magazine, Vox.com, Eater, The Verge and SB Nation — and Group Nine Media — which counts Thrillist, The Dodo, NowThis and PopSugar among its properties — have signed a deal to join forces, the companies said on Monday. Financial details weren’t disclosed, the deal is expected to close in early 2022.
The deal would see Vox Media CEO Jim Bankoff run the combined company, with Vox shareholders owning about 75 percent of the firm. Group Nine CEO Ben Lerer would join the combined company’s board of directors.
“Under Ben’s stewardship, Group Nine has navigated from a scrappy start-up to one of the biggest and most successful publishers in the industry,” said Bankoff in a statement unveiling the deal. “Much like us, their team has proven to be a leader in both building cherished media brands from the ground-up as well as successfully acquiring and integrating properties. With this acquisition, Vox Media will extend its leadership into new categories, formats and distribution platforms by welcoming more beloved properties into our portfolio.”
In a show of scale, the combined companies touted that they have a total of 350 million social media followers across platforms, per analytics firm Comscore.
Group Nine chief Lerer added: “We could not be more excited about the opportunity to join forces with Vox Media. This combination will not only create unparalleled scale and revenue diversification, it will bring together some of the most popular brands, premium content, and creative and business talent in the world. There is no one I would trust more to lead this company and the team I love than Jim. He is not only kind and fair, but fearless and focused. This is the beginning of our most exciting chapter.”
In a memo to staff earlier in the day after sale talks leaked, Bankoff wrote that “the business rationale behind this merger is to grow revenue, increase scale, and combine these incredibly powerful and complementary portfolios. Together we will be an even stronger, more financially sustainable company that can invest more in our products and our people.”
“A team from both companies will begin developing a thoughtful plan to integrate functions where it makes sense to do so,” he added. “None of our existing editorial offerings or services will change as a result of this combination and we will be thoughtful about how we make decisions and treat people.”
The Wall Street Journal first reported the deal talks.
The companies are active in TV and film production, with Vox producing shows for outlets like Netflix, and Group Nine securing a first-look deal with Discovery+ (Discovery is also a major investor in the company).
The merger, if consummated, would serve as the biggest piece of consolidation yet in the digital media space. Earlier this month, BuzzFeed went public through a SPAC merger, and acquired Complex Networks as part of that deal.
Other digital media players have held back while waiting to see how the market responds to BuzzFeed. Vice Media, after SPAC talks of its own broke down, decided to raise more funds privately, while Bustle Digital Group CEO Bryan Goldberg has said that he intends to take his company, which owns Gawker, Bustle, Mic and Nylon, public at some point in the next year.
“With regard to our future, it’s important and reassuring to know that we have control over our destiny and, given the financial strength of our combined company, the flexibility to take our own path,” Bankoff wrote Monday. “As we discussed in our last all-hands, we have no immediate plans to go public, although we’ll always continue to evaluate opportunities that are in the best interest of all of our stakeholders, including our employees.”
Bankoff’s full memo to staff is below.
From: Jim Bankoff
Sent: Monday, December 13, 2021 1:36 PM
To: Vox Media All Staff
Subject: Important (and very exciting) announcemen
Due to a leak, this news is breaking prematurely, but I’m writing to share what I expect to be one of the most exciting and significant announcements in our company’s history. Vox Media is in advanced discussions to acquire Group Nine Media.
As you probably know, Group Nine Media is home to some of the biggest and most loved brands on social media including PopSugar, the Dodo, Thrillist, Seeker, and NowThis. Their organization is strong and complementary to ours in many areas, from the topics they cover and the audiences they serve to the formats in which they tell stories and the platforms they tell them on. Our combined company will be the clear leader in modern media, reaching audiences at scale everywhere, from podcasts to streaming services, from YouTube to TikTok, from websites to print.
While our combined scale is remarkable, it’s the passion that their teams put into their work that will make this combination a natural fit. Since 2016, Group Nine Media has built some of the biggest brands in publishing, with over 250 million social followers and more than 6 billion video views a month, they continue to grow, particularly on platforms that younger audiences are embracing. While their properties are distinct and different from ours — focusing on telling different types of stories to different audiences, often in different formats — both companies share values of quality, ambition, inclusiveness and integrity. They’ve built a strong and growing advertising business that will enable our combined company to provide marketers a full suite of solutions including unique and valuable offerings in social and video, where consumers are devoting more attention than ever. Their revenue is also diversified beyond advertising with a robust studios operation, affiliate commerce and licensing partnerships with major retailers.
The business rationale behind this merger is to grow revenue, increase scale, and combine these incredibly powerful and complementary portfolios. Together we will be an even stronger, more financially sustainable company that can invest more in our products and our people.
This deal is not yet signed, but we anticipate it will be shortly. Between now and when the deal closes, in early 2022, we will be operating as two completely separate companies. Group Nine Media founder and CEO Ben Lerer, who built the company from a newsletter to a leading digital publisher, will take a new role on our Board of Directors and will advise us on key strategic initiatives. A team from both companies will begin developing a thoughtful plan to integrate functions where it makes sense to do so. None of our existing editorial offerings or services will change as a result of this combination and we will be thoughtful about how we make decisions and treat people.
With regard to our future, it’s important and reassuring to know that we have control over our destiny and, given the financial strength of our combined company, the flexibility to take our own path. As we discussed in our last all-hands, we have no immediate plans to go public, although we’ll always continue to evaluate opportunities that are in the best interest of all of our stakeholders, including our employees.
We are working on scheduling a brief all-hands for employees. You’ll get a calendar invite with a form to submit questions ahead of time. If you have any questions in the meantime, please reach out to your executive.
Dec. 15, 5:15 pm Updated with statement from companies confirming merger plans.
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