Prime Highlights
- Byron Allen will acquire a 52 percent stake in BuzzFeed for $120 million and take over as CEO.
- BuzzFeed shares surged after investors reacted positively to the acquisition announcement.
Key Facts
- BuzzFeed went public in 2021 through a blank-check merger valued at about $1.5 billion.
- Allen Family Digital will buy 40 million BuzzFeed shares at $3 per share under the agreement.
Background
Byron Allen has agreed to acquire a majority stake in BuzzFeed through a $120 million deal that will also see him become the company’s next chief executive officer.
BuzzFeed said Allen Family Digital will purchase around 40 million shares at $3 each, giving it a stake of about 52 percent in the company. The offer represents a major premium compared with the company’s previous closing share price and triggered a sharp rise in BuzzFeed shares in extended trading.
As part of the agreement, BuzzFeed founder and current CEO Jonah Peretti will move into a newly created role as president of BuzzFeed AI after the transaction closes. The company said the deal is expected to be completed by the end of the month.
The acquisition comes as BuzzFeed works to strengthen its financial position amid changes in the digital advertising market. Advertising spending has increasingly shifted toward large social media platforms such as TikTok and Meta Platforms’ Instagram.
BuzzFeed said it plans to provide an updated financial outlook in the coming months as the company moves ahead with new leadership and investment plans.
The transaction will be funded through a combination of cash and a promissory note carrying a five percent annual interest rate over five years.
