Entertainment mogul Byron Allen to acquire Buzzfeed, HuffPost
Digital entertainment company BuzzFeed Inc. is selling its majority stake to Los Angeles entertainment mogul Byron Allen for $120 million.
BuzzFeed announced the sale late Monday, saying Allen Family Digital had agreed to pay $3 apiece for 40 million shares, representing a 52% stake in the company.
Allen will pay $20 million in cash up front, with the remaining $100 million due in five years.
As part of the deal, Allen will also take over HuffPost, another Internet pioneer, owned by BuzzFeed.
The sale is expected to be finalized later this month. BuzzFeed founder and current chief Jonah Peretti will take on a new role as president of BuzzFeed AI.
Allen will become president and CEO.
“This investment in our business and Byron’s management roles will provide liquidity and operational direction for BuzzFeed,” Peretti said in a statement.
Once a darling of the Internet, valued at $1.5 billion, the 20-year-old site has wowed consumers with its lists, splashy news articles and quizzes, including “Which ‘Schitt’s Creek’ Character Are You?” »
BuzzFeed has been in financial difficulty for several years. It purchased HuffPost in 2021 to strengthen its readership and offers to advertisers. Three years ago, it shut down its once-ubiquitous BuzzFeed News unit.
BuzzFeed reported a net loss of $15 million in the first quarter of the year. The company generated revenue of $31.6 million, down 12.4% from the same period last year. Advertising revenue fell nearly 20% year over year to $17.1 million. However, content revenue increased by more than 50%, to $7.5 million.
BuzzFeed will soon make another round of significant cost reductions ahead of Allen’s buyout, Peretti said in the statement. He added that BuzzFeed Studios and Tasty would separate to form a new independent entity.
The deal comes at a busy time for Allen, a former comedian who will take over CBS’ late-night block later this month, replacing “The Late Show with Stephen Colbert,” which is being canceled by CBS and its owner, Paramount Skydance.
Earlier this month, Allen sold television stations in nearly a dozen markets owned by Allen Media Group to Atlanta-based Gray Media Inc. for about $170 million.
Allen still has 13 network-affiliated stations in nearly a dozen markets, the Weather Channel’s linear cable channel, and digital channels including Pets.TV and Comedy.TV.
“Our vision is to build on the iconic foundations of BuzzFeed and HuffPost by expanding into free streaming video, audio and user-generated content,” Allen said. “BuzzFeed is officially suing YouTube to become another leading free video streaming service.”
