Germany's ProSiebenSat.1, General Atlantic Buy Online Dating Company The Meet Group

ProSiebenSat.1 CEO Max Conze - H 2018
Courtesy of ProSiebenSat.1

The deal values the owner of dating platforms MeetMe, Tagged and Lovoo at $500 million, with plans to merge it with ProSiebenSat.1-controlled online dating company The Parship Group.

German media giant ProSiebenSat.1 and private equity group General Atlantic have teamed to acquire The Meet Group, an online dating company that owns social media platforms such as MeetMe, Tagged and Lovoo.

The buyout deal, announced Thursday, values The Meet Group at approximately $500 million. The transaction is expected to clear by the second half of this year. ProSiebenSat.1 plans to merge The Meet Group with its own online dating company The Parship Group, which operates platforms including Parship, eharmony and ElitePartner.

“The acquisition of The Meet Group is one of ProSiebenSat.1’s largest transactions. It will significantly advance our ambition to create one of the leading global players in online dating and interactive live video,” said ProSiebenSat.1 CEO Max Conze. “We believe the combination of these two successful and complementary businesses will also create synergies within the ProSiebenSat.1 universe and accelerate the growth of our market share in the German live video apps sector.”

ProSiebenSat.1 on Thursday published its 2019 year-end results, showing a revenue growth of 3 percent to €4.135 billion ($4.6 billion), largely due to growth in digital and production operations. Production division Red Arrow Studios saw double-digit revenue growth, with full-year sales jumping 18 percent to $727 million. The company and its many subsidiaries worldwide produce such series as Netflix's dating show Love Is Blind and the Amazon Studios crime drama Bosch. Red Arrow also owns digital studio Studio71, which produces YouTube channels from the likes of online stars and influencers Flula Borg, Lilly Singh and Grace Helbig.  

ProSieben's digital commerce division the NuCom Group increased revenues by 16 percent to $1.08 billion.

Conze also highlighted the company's investment in Joyn, an ad-supported streaming platform launched last fall as a joint venture with Discovery. As of the end of 2019, Joyn had more than 7 million total monthly active users with more than 6.5 million Joyn apps installed across all devices, he said.

ProSiebenSat.1 is pushing hard into digital operations and the targeted advertising made possible by online technology, hoping it will compensate for the decline in the traditional TV ad business, where the company saw a 5 percent drop in revenues last year. The company, which owns numerous free-to-air broadcasters in Germany and commands a 28.2 percent share of total TV viewers in the 14-49 demographic, is now more a digital company than a television one. In 2019, fully 52 percent of revenue at ProSiebenSat.1 came from outside its core free-TV ad business.

Operating profits (EBITDA) for the full year were down 14 percent to $972 million and adjusted net income was off 28 percent to $431 million in large part due to the company's heavy investment in new businesses. For the full year, Conze is forecasting revenues of $4.8 billion and operating profits (EBITDA) of some $970 million.

The German group has been the source of takeover speculation since Italian media giant Mediaset increased its stake in ProSiebenSat.1 to 20 percent late last year. Mediaset has said it has no plans to fully acquire ProSiebenSat.1, but the Italian company is pushing the German group to join Media for Europe (MFE), a Dutch holding company Mediaset has created into which it hopes to combine its Italian and Spanish media assets. Mediaset has pitched MFE as a vehicle for the European TV industry to achieve scale as a means of fighting off global streaming giants like Netflix and new SVODs players such as Disney+ and Apple TV+.