Sale of Meredith Corp. final as Gray Television, IAC/Interactive's Dotdash take over
The sales of Des Moines-based Meredith Corp.'s broadcasting and magazine divisions closed Wednesday.
Following a shareholder vote Tuesday in which 99% of investors approved of the deal, Meredith sold its 17 local TV stations to Atlanta-based Gray Television for $2.8 billion. Meredith then spun off its magazine division to a separate company, which New York-based Dotdash purchased for $2.7 billion.
Gray announced in a news release Wednesday that the Meredith deal gives the company the second-most revenue of any local broadcaster in the country, with a foothold in 113 local markets. Among Gray's new stations are channels in Atlanta, Phoenix, Portland, Oregon, and Nashville, Tennessee.
Gray and Meredith first announced the deal in May. The sale will have limited impact in Des Moines, as Meredith's TV division only employed five workers at its corporate headquarters and had no stations in Iowa.
“Gray is a far stronger company today with the exciting and transformative addition of Meredith’s excellent television stations and its fine employees,” CEO Hilton Howell said in a statement.
Dotdash, meanwhile, takes over Meredith's magazine division, including 39 websites. The division accounted for about two-thirds of Meredith's revenue last year, led by the titles People and Better Homes and Gardens.
Dotdash is a division of the publicly traded tech incubator IAC/Interactive Corp. Owned by former studio executive Barry Diller, IAC/Interactive develops digital companies with the goal of eventually spinning them off at a profit.
Dotdash is the product of IAC/Interactive's acquisition in 2012 of About.com, a New York Times-owned site where expert sources posted answers to questions on a variety of subjects.
The company rebranded as Dotdash in 2017, breaking up About.com's content into separate lifestyle websites, including the home design site The Spruce and the beauty publication Byrdie. The company runs on what is known as an "intent-driven" journalism model, continuing to write posts that answer questions that attract readers through Google searches.
It will now become Dotdash Meredith. IAC leaders have told investors the acquisition marries the strengths of two worlds: the brand recognition of the well-established publications of Meredith, which was founded in Des Moines in 1902, and the tech know-how of the Dotdash team.
“No other media company in the world combines this kind of heritage with the scale, speed and power of a digital-first business," Dotdash CEO Neil Vogel said in a news release Wednesday.
The Dotdash sites are known for loading especially fast, avoiding auto-play videos and pop-up advertisements. The websites deliberately limit ads, which Dotdash leaders say makes for a cleaner user experience that draws more viewers.
Ads are matched to the content on a particular page so companies reach the customers they want. The company also directs readers to online retailers, receiving revenue for each sale that comes from a Dotdash click.
The IAC team has not yet said what the acquisition will mean for Des Moines, where about 870 Meredith workers are based, though Dotdash has said it will be an important part of the combined companies' operations.
Vogel also told investors on a call in November that the Meredith properties will continue to publish printed magazines, though he added, "We're not the guys that are going to change the secular advertising decline on print."