Univision Communications has agreed to sell Gizmodo Media Group, owner of satire website The Onion, to a private equity company after a nine-month sales process — the latest deal involving digital publishers in the past year as conditions worsen for niche media companies.
Private equity firm Great Hill Partners said Monday it would acquire Gizmodo's properties, which are said to reach an audience of around 100 million people, for an undisclosed amount.
Gizmodo’s digital destinations include the women-focused website Jezebel, the sports-focused website Deadspin, the African-American issues website The Root, and personal improvement website Lifehacker, among others, while The Onion also houses culture website The A.V. Club and ClickHole, a conservative satire site.
Gizmodo will be renamed G/O Media and will be run by Jim Spanfeller, a former Forbes.com chief executive, according to Great Hill Partners, which has investments in consignment clothing destination The RealReal and candy company Sugarfina.
Digital publishers have endured challenging business conditions and been forced to lay off staff, partly as a result of advertisement dollars that have moved to Facebook and Google. Vice Media said in February it was cutting 250 staff, while HuffPost, part of Verizon Media, and BuzzFeed have also reduced staff.
The financial terms of the deal were not disclosed, though the unit has been struggling financially. Univision reported a loss of $32.5 million on the websites in its fourth quarter of 2018, an increase from $3 million in the same period a year earlier.
Gizmodo was founded by entrepreneur Nick Denton, who sold his digital media brands after a legal battle with professional wrestler Hulk Hogan. The legal fight was funded by Silicon Valley investor Peter Thiel.
Gizmodo, previously a part of Gawker Media Group, was acquired by Univision’s Fusion digital media unit for $135 million in Aug. 2016 in an attempt to attract a younger audience beyond Univision’s core Spanish-language audience. The Gawker website, which once carried gossip and reported articles about people in the media, is now in the hands of Bryan Goldberg, who acquired it for $1.4 million. Goldberg owns Bustle Digital Group, which acquired millennial-focused news and politics website Mic for $5 million in November.
“We know it is not every day that an attractive suite of digital media assets becomes available with strong brand recognition among consumers and advertisers, and a set of engaged, vertical audiences which together are larger than Vox, BuzzFeed or Vice,” Chris Gaffney, managing partner at Great Hill Partners, said in a statement.
Separately, the Gizmodo Media Group Union and the Writers Guild of America East, tweeted that they looked forward to working with the new management on its bargaining agreement.
Media analyst Ken Doctor, who writes about the media at Newsonomics.com, said the deal added to other recent digital media acquisitions that were once flush with venture capital cash but were unable to attract ad dollars away from the major tech platforms.
“It’s a similar story with [tech media website] Mashable and Mic and other assets sold recently," Doctor said. "We attribute that to the impact of the duopoly" of Facebook and Google.