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Meredith, home to publications such as People, EW, Better Homes & Gardens and InStyle, will be part of Dotdash, the digital publishing division of Barry Diller’s holding company IAC, as part of a buyout plan. The terms give the deal an enterprise value of around $ 2.7 billion.
As part of the deal, Dotdash will acquire Meredith in an all-cash transaction at a purchase price of $ 42.18 per share. The deal is expected to close by the end of 2021. The proposed deal does not include the local television business of Meredith, which the company agreed to sell to Gray Television for $ 2.7 billion earlier this year. year.
The combined company will be called Dotdash Meredith and will be led by Dotdash CEO Neil Vogel. When asked if layoffs were expected as a result of the merger, an IAC spokeswoman said: “This is not our goal at the moment. This is a story of growth and we are excited about the upcoming opportunity for Dotdash Meredith.
On its own, Dotdash currently reaches around 100 million online consumers every month. The combined company would reach 175 million online consumers per month, 95% of whom are American women, according to the companies.
“The Meredith family is extremely proud of all the company has accomplished over the past 120 years, which is a direct reflection of our dedicated employees,” said Mell Meredith Frazier, vice chairman of the board of directors of Meredith, in a statement. “Our creative and dedicated employees have guided our beloved brands through a rapidly changing media landscape, enriching the lives of generations of Americans.”
Dotdash, formerly known as About.com, was bought by IAC from the New York Times in 2012 for $ 300 million in cash. Dotdash is home to 14 brands across health, finance, lifestyle, food and beauty – which it says are among the fastest growing in their categories – including Verywell, Investopedia, The Balance, The Spruce, Simply Recipes, Serious Eats, Byrdie, Liquor.com, Treehugger and Brides. In 2020, Dotdash reported revenue of $ 214 million and adjusted profit of $ 66 million before interest, taxes, depreciation and amortization.
“We have often found opportunities in the digital transformations of businesses and industries: travel, ticketing, dating, home services and now publishing. Meredith is already experiencing record digital growth and we believe Dotdash can help accelerate that growth, ”said Joey Levin, CEO of IAC, in a statement.
In addition to a larger audience scale, Dotdash and Meredith will result in more diverse overall business, according to the companies. The deal combines Meredith’s advertising capabilities and first-party data with Dotdash’s expertise in e-commerce and performance marketing. Over the past 12 months, the companies collectively generated more than $ 1 billion in advertising revenue, while their e-commerce capabilities generated more than $ 1 billion in sales from retail partners.
“Our digital business is growing rapidly, overtaking our magazine sales for the first time in company history,” said Tom Harty, President and CEO of Meredith. “The combination of Meredith’s famous cross-platform brands, creative content and first-party data with Dotdash’s premier digital brands is a game-changer for the industry. Nowhere else will you find such a high-end portfolio of media assets under one roof. We are excited to join forces to accelerate the digital future of Meredith.
Meredith, founded in 1902, closed its acquisition of Time Inc. for $ 1.85 billion (excluding debt) in 2018, funded in part by politically conservative brothers Charles and David Koch. Meredith has since sold Time magazine (to Salesforce CEO Marc Benioff), as well as Sports Illustrated, Fortune and Money.
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