Group Nine Media is interested in acquisitions that could grow its audience.
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Group Nine Media, owner of websites such as The Dodo and NowThis, is considering using a blank-check company to acquire some of its competitors, according to people familiar with the matter, as the digital-media sector continues to consolidate.
In recent weeks, Group Nine Media has consulted with advisers about the possibility of pursuing deals through a special-purpose acquisition company, also known as a SPAC, the people said. Those blank-check companies raise capital by going public and can put the proceeds into deals.
Group Nine Media is interested in acquisitions that could grow its audience and give it more bargaining power with online advertisers.
The venture-backed company, which formed in 2016 through the merger of several digital-media businesses, has already begun buying competitors. Last year, it purchased PopSugar, a women-focused digital publisher, adding its site and web properties to a portfolio that includes animal-focused The Dodo and NowThis, a news publisher.
It isn’t clear which company or companies Group Nine Media would target for acquisitions. Group Nine’s all-stock deal with PopSugar valued Group Nine at $600 million, The Wall Street Journal reported.
As the digital-media sector has matured, several companies have looked to deal making to spur growth. BuzzFeed Inc. last month announced a stock deal to acquire Verizon Media’s HuffPost, bringing two of the most prominent new-media companies together.
Last year, Vice Media Group announced a deal to acquire women-focused publisher Refinery29, while Vox Media Inc. merged with New York Magazine publisher New York Media.
Digital-media companies have struggled to maintain fast growth in online ad sales, given stiff competition from tech giants including Facebook Inc. and Alphabet Inc.’s Google. The coronavirus pandemic added more pressure on the sector, though some companies have begun to bounce back. BuzzFeed expects to turn an operating profit this year for the first time in years.
Group Nine is known for news, travel and animal videos posted on social-media platforms that are shared widely. Its other properties include Thrillist, popular with travel and food enthusiasts, which was founded by Group Nine Chief Executive Ben Lerer.
Write to Benjamin Mullin at [email protected]
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