The May-December romance between German publishing giant Axel Springer and Business Insider has been made official.
The latest marriage of old and new media firms values the Web publisher at $442 million. New details of the deal, which has been anticipated for a week, include that Springer will end up paying $343 million. The acquisition leaves Springer, which already owned 9 percent of BI, with control of all but 3 percent of the company. The remaining portion is owned by Amazon founder Jeff Bezos.
It's a major victory not just for the entrepreneurial team and investors behind Business Insider, but also for New York City's vibrant, young tech-media community, which has been puffed full of investors and new endeavors in recent years. It sets a new benchmark for deals, in fact, in the post-Huffington-Post-AOL-acquisition era. (That deal closed for $315 million.)
Axel Springer, which is best known as the owner of German newspapers Die Welt and Bild, has been angling to increase its English-language presence. It bought a minority stake in Business Insider in January. The $25 million funding round valued the company at about $200 million. More recently, Springer lost a bidding war for the Financial Times.
"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," Axel Springer's CEO, Mathias Döpfner, said in a statement.
Former Wall Street analyst Henry Blodget founded Business Insider, originally called Silicon Alley Insider, in 2007 with serial entrepreneur Kevin Ryan. The acquisition solidifies a comeback narrative for Blodget, who rose to notoriety during the first dot-com boom, before being banned from Wall Street.
According to Web analytics firm Comscore, BI attracted more than 40 million unique visitors in August, making it the most-viewed business news site aside from Yahoo Finance. The company says it has 76 million monthly unique visitors.
It's not Axel Springer's first foray into the digital space, and Döpfner has spoken in the past about his intentions to invest in digital media. The publisher partnered with Politico on a European version of the Washington politics site, and has invested in the news website Ozy, which was founded in 2013 by former McKinsey consultant and MSNBC news anchor Carlos Watson.
Earlier this month, Manager Magazine reported that Axel Springer was looking to buy a controlling stake in Business Insider. On September 22, Recode's Peter Kafka reported that the deal was near, based on accounts from unnamed sources.
How's business been at BI lately? Kafka writes:
Business Insider hasn't disclosed its revenues recently. In 2013, it did around $20 million. In January, when Blodget announced his latest funding round, he said revenues had grown 70 percent in 2014, and that the company was "solidly profitable" in the second half of the year.
A few months later, Business Insider COO Julie Hansen said the company wasn't profitable, because it was plowing resources into expansion. It has recently launched a U.K. edition as well as TechInsider, a site dedicated to "tech, science, innovation, and culture," as well as Insider, a publishing project that aims to push most of its content to other platforms like Facebook and Twitter.
The deal sets a new mark for acquisitions, but it's just one example of how traditional media has been furiously pumping money into online ventures recently. In August Comcast's NBCUniversal invested $200 million in BuzzFeed, and another $200 million in Vox Media. And last week, Hearst took a minority stake in Complex, a network of video-driven websites founded by Marc Ecko.
Business Insider has raised $57 million since 2007.