Getty Images and Shutterstock have announced that they have entered into a merger agreement. The combined company will trade under the name Getty Images Holdings Inc. and has a value of around $3.7 billion.
Although it has been announced as a merger, Getty Images is buying Shutterstock in a cash-and-stock deal. Existing Shutterstock shareholders can sell their shares for $28.80 each, exchange them for 13.67 shares in the new company or opt for a combination of each. In addition, following the deal, Getty Images shareholders will own around 55% of the new business. Shutterstock shareholders will have the remaining 45% of shares. Current Getty Images CEO, Crag Peters, will also stay on as head of the merged business.
Peters said, “Today’s announcement is exciting and transformational for our companies, unlocking multiple opportunities to strengthen our financial foundation and invest in the future—including enhancing our content offerings, expanding event coverage, and delivering new technologies to better serve our customers. With the rapid rise in demand for compelling visual content across industries, there has never been a better time for our two businesses to come together.”
The current Shutterstock CEO, Paul Hennessy, will be on the board of directors of the new Getty Images Holdings. He said, “We are excited by the opportunities we see to expand our creative content library and enhance our product offering to meet diverse customer needs. We look forward to working closely with the Getty Images management team to complete the transaction and drive the next chapter of growth.”
Profit driven
While both CEOs promised improvements for customers, they also both made it clear that investors would benefit from the merger. Peters said, “By combining our complementary strengths, we can better address customer opportunities while delivering exceptional value to our partners, contributors, and stockholders.” Hennessy also commented, “We expect the merger to produce value for the customers and stockholders of both companies by capitalizing on attractive growth opportunities to drive combined revenues, accelerating product innovation, realizing significant cost synergies, and improving cash flow.”
What we think
The improvements in and wider availability of generative AI is clearly having an impact on stock video and image libraries. Businesses can now create unique and bespoke content, rather than searching for a clip or photo that best suits their needs. In the face of this challenge, it therefore makes sense for Getty Images and Shutterstock to join forces and increase their resilience. However, whether this slows the move to AI-generated video and images remains to be seen. In addition, Getty Images and Shutterstock will have to work to ensure that the merger brings their customers additional benefits if they want to keep them subscribing.
