A digital-age magazine giant was born on Wednesday with the announcement that Dotdash, a publishing unit of Barry Diller\u2019s InterActiveCorp, had reached an agreement to acquire Meredith Corporation, the publisher of People, Better Homes & Gardens, InStyle, Entertainment Weekly and roughly 40 other titles and digital brands.<\/p>\n
The purchase price is roughly $2.7 billion, or $42.18 per share, the companies said in a joint announcement. If the deal goes through, the new company will be called Dotdash Meredith, and it will be led by the Dotdash chief executive, Neil Vogel, the companies said.<\/p>\n
Joey Levin, IAC\u2019s chief executive, said in a statement that the combination of the two companies would \u201coffer uniquely engaged audiences to advertisers and partners.\u201d Tom Harty, the chief executive of Meredith, said in a statement, \u201cWe are thrilled to join forces to accelerate Meredith\u2019s digital future.\u201d<\/p>\n
In an investor call on Wednesday, Mr. Vogel said he was not planning on \u201ccost synergy\u201d \u2014 that is, layoffs or other cuts as a result of the merger. \u201cOur playbook is going to drive audience, performance, and help the brands maintain their stance in the digital world that they have in the print world,\u201d Mr. Vogel said.<\/p>\n
The merger would come as a hit to Des Moines, Iowa, where Meredith is a major employer: Dotdash Meredith is to be based in New York, at Dotdash\u2019s headquarters in the Chelsea neighborhood of Manhattan, an IAC spokeswoman said. The new company would \u201ckeep a presence\u201d in Des Moines, the spokeswoman added.<\/p>\n
Meredith was founded in 1902 by Edwin T. Meredith, later the agriculture secretary under President Woodrow Wilson, with a magazine called Successful Farming. It became a media behemoth in 2018, when it bought the storied news media company Time Inc. for $2.8 billion.<\/p>\n
IAC, where Mr. Diller serves as chairman, is the company behind Tinder, Match and OKCupid. Its publishing unit, Dotdash, operates 14 lifestyle journalism sites, including Serious Eats and Investopedia. Dotdash got its start in the early 1990s as the website About.com and became part of IAC in 2012, when Mr. Diller bought it for $300 million from The New York Times Company.<\/p>\n
Dotdash showed signs of change in 2019, when it bought a venerable magazine, Brides, from Cond\u00e9 Nast, the publisher of Vogue, Vanity Fair and The New Yorker. It soon scrapped the 85-year-old print version to concentrate on the Brides website. That acquisition was part of a buying spree that included Dotdash\u2019s purchases of Liquor.com, Treehugger and Simply Recipes.<\/p>\n
At the time of the expansion, Mr. Vogel said his idea for Dotdash was that it would become \u201cwhat the future of Cond\u00e9 Nast should be.\u201d The acquisition of Meredith puts the company closer to realizing that ambition.<\/p>\n
Magazines have been crunched in recent years by readers\u2019 preference for digital over print, where advertising is both less lucrative and dominated by tech companies.<\/p>\n
Charles Whitaker, the dean of the Medill School of Journalism at Northwestern University, said that in purchasing Time Inc., Meredith had been \u201cwildly optimistic about the extent to which acquiring those brands would create these economies of scale and synergies that would help them fend off the Googles and Facebooks of the world.\u201d<\/p>\n
He added, \u201cThis continued consolidation is obviously troubling. The more competition and the more companies that we have producing content, providing jobs and appealing to audiences is better for the industry.\u201d<\/p>\n
Meredith slimmed itself down considerably in the years since its purchase of Time Inc., shedding three prominent Time Inc. titles that did not fit the company\u2019s specialty \u2014 magazines about style, fashion, celebrity news and homemaking.<\/p>\n
Time magazine, the flagship, went to Marc Benioff, the chief executive of Salesforce, and his wife, Lynne, for $190 million later in 2018. The company also sold Fortune, for $150 million, to Chatchaval Jiaravanon, a scion of a prominent Thai family, and Sports Illustrated, for $110 million, to Authentic Brands Group. (A.B.G. later sold Sports Illustrated to TheMaven, which last month renamed itself the Arena Group.)<\/p>\n
Meredith also sold another asset it had picked up in the Time Inc. deal \u2014 Time Inc. U.K., the publisher of Woman\u2019s Weekly and Wallpaper magazines \u2014 to the London private equity firm Epiris for a reported $167 million. In June, Meredith announced the sale of its local media properties, which included 17 television stations in Atlanta, Phoenix and other markets, to Gray Television in a $2.8 billion deal.<\/p>\n
If the planned merger goes through, Dotdash Meredith will be a top-10 publisher in terms of audience size, according to the internet metrics service Comscore, the companies said.<\/p>\n