Business Insider, founded in 2007 by Henry Blodget, Dwight Merriman, and Kevin Ryan, has been acquired by the German publishing powerhouse Axel Springer for about $US450 million.
Axel Springer already owned a portion of Business Insider from previous funding rounds. It is purchasing an additional 88% for $US343 million, bringing its total ownership to 97%. Jeff Bezos’ investment arm will own the remaining 3%.
Henry Blodget and Business Insider president and COO Julie Hansen will remain at the helm. Huffington Post cofounder Ken Lerer is joining Business Insider’s board of directors.
Here’s the official press release:
Axel Springer SE, the leading digital publisher in Europe, today announced a binding agreement to purchase approximately 88 per cent of the shares in New York City-based Business Insider, the leading digital offering for business news in the U.S. This acquisition is a vital part of Axel Springer’s strategy to broaden its global reach, diversify its English- language offerings and expand its commitment to innovative digital journalism.
The addition of Business Insider’s 76 million unique monthly visitors will increase Axel Springer’s worldwide digital audience by two-thirds to approximately 200 million users, making the company one of the world’s six largest digital publishers in terms of reach.
The purchase price based on 100 per cent of Business Insider amounts to USD 442 million (currently approximately EUR 395 million) on the basis of a cash and debt free valuation of USD 390 million (currently approximately EUR 348 million). The valuation corresponds to an amount of USD 343 million (currently approximately EUR 306 million) for the 88 per cent of the shares that Axel Springer is acquiring. Axel Springer already holds a stake of approximately nine per cent in the company and, after this purchase, will hold a stake of approximately 97 per cent. Bezos Expeditions, the personal investment company of Jeff Bezos, will hold the further shares.
Henry Blodget, Founder, Chief Executive Officer and Editor-in-Chief, and Julie Hansen, Chief Operating Officer and President, will continue to lead Business Insider in their respective roles. They will also remain significantly invested in Business Insider through an extensive, long-term equity incentive. Kenneth Lerer, Managing Partner at leading early-stage technology venture capital firm Lerer Hippeau Ventures, Co-Founder of Huffington Post and Chairman of Buzzfeed, will receive a seat on the Board of Business Insider.
Mathias Döpfner, CEO of Axel Springer SE: “With the acquisition of Business Insider, we continue with our strategy to expand Axel Springer’s digital reach and, as previously announced, invest in digital journalism companies in English-speaking regions of the world. Business Insider has set new standards in digital business journalism globally. Henry Blodget’s way of digital storytelling reaches tomorrow’s decision-makers. Combining our forces will allow us to unlock growth potential and expand Business Insider’s portfolio to new verticals, new locations and new digital content. We look forward to working together with Henry Blodget, Julie Hansen and the exceptional Business Insider team to continue shaping the future. At the same time, I am thrilled to have our close partner Ken Lerer joining us.”
Henry Blodget, Founder, Chief Executive Officer and Editor-in-Chief of Business Insider: “We have tremendous respect for Axel Springer’s commitment to independent journalism and its global vision for the future. It is a pleasure and privilege to join forces with such a smart, forward-thinking team. We look forward to working together to build a major global news organisation for the digital century.”
With its purely digital business model and focus on millennials, the sought-after target audience of 18 to 34-year-olds, Business Insider is a pioneer among business news portals. It has built a reputation on critical and exclusive reporting that aligns well with how news is consumed on social and mobile channels. Business Insider also offers a paid subscription-based research and information service, known as BI Intelligence.
Business Insider was launched in 2007 by Henry Blodget, Kevin Ryan and Dwight Merriman. It employs more than 325 people, approximately 50 per cent of whom are journalists. In addition to its U.S. news sites, the company has a growing international presence, with local editions or licenses in seven other countries. A German edition will be introduced in the fourth quarter of this year and will be operated by finanzen.net, a company of Axel Springer SE. Editions for other countries are in development.
Axel Springer will finance this acquisition using existing credit lines.
Business Insider is published under license in Australia by Allure Media, a wholly-owned subsidiary of Fairfax Media.
The transaction is subject to approval by relevant antitrust authorities.
Disclosure: Axel Springer is an investor in Business Insider.
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