A month after BuzzFeed announced that it would buy HuffPost, Group Nine Media, the owner of TheDodo, NowThis, Thrillist, Seeker and PopSugar, sent a strong signal that it plans to get bigger.
The company, led by the chief executive, Ben Lerer, formed a special purpose acquisition company, according to an S.E.C. filing on Monday. In the filing, Group Nine said it planned to merge with similar companies but did not cite any agreements with specific partners.
“We initially intend to focus our search on target businesses in the digital media and adjacent industries, including the social media, e-commerce, events, and digital publishing and marketing sectors,” the company said in the filing.
“Our objective,” it added, “is to create a scalable digital media platform.”
Group Nine got its start in 2016, when the companies behind Thrillist, NowThis and TheDodo joined with Seeker, a digital network belonging to Discovery Communications. Discovery kicked in $100 million to help to new company get going, and Mr. Lerer, the former head of Thrillist, became its leader.
Group Nine expanded last year when it acquired PopSugar, a website with a shopping platform, a cosmetics line and a festival business, from the husband-and-wife duo Brian and Lisa Sugar. That deal came as part of a wave of consolidation in the digital media business, after Vox Media’s purchase of New York Media, the company behind New York magazine, and Vice Media’s acquisition of Refinery29.
After the BuzzFeed-HuffPost merger and Group Nine’s federal filing, digital media companies seem likely to continue the trend of joining forces in an industry that is not the wide-open field it used to be. Google and Facebook have grabbed ad revenue away from publishers, while Twitter, Facebook, YouTube and Twitch have monopolized the time and attention of would-be readers. And many legacy media outlets have become web savvy, hiring digital journalists, audience specialists and engineers away from popular sites, while also figuring out ways to persuade their customers to spring for expensive subscriptions.
With the formation of a special purpose acquisition company, a popular financial tool that effectively allows privately held companies to go public without an initial public offering of stock, Group Nine moved closer to making more deals. A Group Nine spokeswoman declined to comment.
Source: | This article originally belongs to Nytimes.com
