Getty Images to merge with Shutterstock in $3.7 billion deal

NEW YORK - Getty Images Holdings, Inc. (NYSE: GETY) and Shutterstock , Inc. (NYSE: NYSE:SSTK ) announced Monday that they have entered into a definitive agreement to merge in a deal that values the combined entity at approximately $3.7 billion. The new entity will retain the Getty Images name and continue to be listed on the New York Stock Exchange under the ticker GETY.

The merger aims to create a premier visual content company by combining Getty Images' and Shutterstock's vast content libraries. The deal is expected to provide customers with a more extensive selection of visual content and offer the contributing community expanded global reach.

Craig Peters, CEO of Getty Images, commented on the merger's potential, highlighting the importance of visual content and the opportunities for growth by leveraging the combined strengths of both companies. Paul Hennessy, CEO of Shutterstock, also expressed enthusiasm for the enhanced product offerings and value creation for customers and shareholders alike.

The combined company is projected to have a robust financial profile, with revenues ranging from $1.979 to $1.993 billion, including a significant portion from subscription services. EBITDA is forecasted to be between $569 million and $574 million before synergies, with net leverage expected at 3.0x pro forma 2024 EBITDA.

In terms of leadership, Peters will serve as CEO of the merged company. An eleven-member Board of Directors will be formed, including six directors from Getty Images and four from Shutterstock, with Mark Getty as Chairman.

Under the merger terms, Shutterstock stockholders will have the option to receive cash, Getty Images stock, or a combination thereof, subject to proration. The transaction is estimated to include $331 million in cash and 319.4 million shares of Getty Images stock, excluding unvested Shutterstock equity.

The ownership of the combined company will be approximately 54.7% for Getty Images stockholders and 45.3% for Shutterstock stockholders on a fully diluted basis.

Completion of the merger is subject to regulatory approvals, approval by both companies' shareholders, and refinancing of Getty Images' existing debt. The transaction has received unanimous approval from both Boards of Directors.

Berenson & Company, LLC and J.P. Morgan Securities LLC are serving as financial advisors to Getty Images, while Allen & Company LLC is advising Shutterstock. Legal counsel for the companies are Skadden, Arps, Slate, Meagher & Flom LLP for Getty Images, and White & Case LLP for Shutterstock.

The companies will hold a joint conference call today to discuss the merger details. This article is based on a press release statement.

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Source: Investing.com