Univision Paid $200M For Gizmodo Media, Parent Of The Root. Here’s Why It Sold It For Less Than $50M
Private-equity firm Great Hill Partners has agreed to buy Gizmodo Media Group, parent of The Root and The Onion, from Spanish-language giant Univision Communications Inc., WSJ reported.
Univision acquired a group of English-language digital media publications from Gawker Media starting in August 2016 for about $200 million and renamed them Gizmodo Media Group. It was a deal that was seen as a bargain at the time but would be considered less so today, Jeremy Barr wrote for the Hollywood Reporter.
Gizmodo Media Group sites included The Root, Gizmodo, The Onion, Jezebel, Deadspin, Lifehacker
Ahead of a planned IPO, Univision’s strategy was to buy and build a diversified portfolio that included websites users go to directly, commerce and branded content, a TV network and TV production.
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The effort was troubled from the start — “a corporate shit show, repleted with competing management cliques, clashing company cultures, ballooning costs and impatient investors,” Sahil Patel wrote for
“The company wasn’t profitable, and as pressure mounted at Univision to reverse its own debt ahead of that public offering, tensions started to mount between different parts of the legacy and digital organizations,” Digiday reported.
The Univision IPO was cancelled in March 2018.
Gizmodo Media Group and The Onion generated about $80 to $85 million in revenue in 2018, three sources told Digiday. But the organization was still tens of millions in the red.
Ultimately, Univision sold Gizmodo Media Group and The Onion for less than a quarter of what it paid for the properties since 2016.
Univision wants to focus on its core assets and Hispanic audience, according to Vincent Sadusky, who was named CEO of Univision in May 2018, Digiday reported.
The new digital media conglomerate has been renamed G/O Media Inc. It will be “the largest player in our space,” said James Spanfeller, CEO of the new company. Spanfeller is the former CEO of Forbes.com and president of consumer magazines at digital publisher Ziff Davis.
The new media group’s combined audiences “are larger than Vox, BuzzFeed or Vice,” said Chris Gaffney, managing partner at Great Hill Partners: “From our experience across the digital media landscape, 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 … We are excited by growth and see a great opportunity to further scale a high-quality content producer.”