After news of the deal leaked out early Monday, Vox and Group Nine have announced the all-stock merger which will further grow the merged entity into one of the largest online publishers.
The previously rumored deal was confirmed on Monday night in a post on Vox's Recode.
"The throughline for all these deals -- real and proposed -- is scale: Get big enough, the rationale goes, and it makes it easier to sell ads, or subscriptions, or both," wrote Recode's Peter Kafka. "And at this point in the pitch you're supposed to mention the looming digital media duopoly of Google and Facebook, and argue that consolidation is an antidote to that.
Vox Media is the owner of many major online news properties, including the tech-focused The Verge, the gaming-oriented Polygon, Vox.com, and the sport-based SB Nation. Vox has steadily been acquiring other outlets to swell its coverage, such as acquiring cocktail website Punch in August.
Group Nine Media is best known for its NowThis outlet, as well as Thrillist and The Dodo. The company has also explored its own growth, including purchasing PopSugar in 2019 and toyed with an earlier deal with BuzzFeed.
The merger is an all-stock transaction, with Vox Media controlling 75% of the combined entity, while 25% would go to Group Nine. Jim Bankoff, Vox's CEO, would head up the new firm.
Group Nine counts Discovery Networks amongst its investors. Vox Media has funding from Comcast. It's not clear if this is a problem, or if either larger media conglomerate cares beyond profit from the deal.
In terms of how much the merged company could be worth, it is thought that it would generate in excess of $700 million in revenue during 2022, making over $100 million in profit. Neither company made clear what it was expecting for revenue, nor in savings typically gained by corporate synergies resultant from layoffs of redundant staff.
The combined entity also has access to a black-check SPAC company commonly used for going public or acquisitions, that Group Nine spun up in early 2021 for reasons unknown. It's not clear what Vox will do with it yet.
In an email on Monday, Vox Media CEO Jim Bankoff told the company's employees that there are no immediate plans to go public.