German publisher Axel Springer is to buy a further 88 percent of news website Business Insider for $343 million, increasing its stake to 97 percent and accelerating its push into digital, English-language content.
Springer said it already owns about 9 percent of the website, which has 76 million monthly visitors.
“The transaction is an essential component of Axel Springer’s strategy to grow with digital journalistic offerings in English-language geographies,” the company said in a statement, adding that it would get access to an important target audience of 18- to 34-year-olds with the new portal.
Business Insider will make Axel Springer the world’s sixth digital publisher after CBS, Hearst, Conde Nast, Times Inc. and Huffington Post, overtaking Buzzfeed, News Corp and the BBC, the German publisher said on a conference call with analysts.
After missing out on buying the Financial Times from Pearson earlier this year, Springer – publisher of Europe’s best-selling Bild newspaper – vowed to concentrate on digital expansion through small and medium-sized deals.
The deal values Business Insider at $390 million at a cash and debt-free basis, or at 6 times next year’s expected revenue.
Axel Springer shares were down 2 percent by 1315 GMT, underperforming the STOXX Europe 600 Media index which was down 1.2 percent.
Business Insider will invest in expansion in the coming years and expects earnings before interest, tax, depreciation and amortization (EBITDA) to reach break-even levels by 2018.