By Rishi Kant and Aditya Soni
(Reuters) -Getty Images said on Tuesday it would merge with its rival. Shutterstock (NYSE:) to create a $3.7 billion stock-imaging powerhouse geared toward the age of artificial intelligence, in a deal that will likely draw antitrust scrutiny.
The companies, two of the largest players in the licensed visual content industry, are betting that the combination will help them reduce costs and grow their business by unlocking more revenue opportunities at a time when the growing use of Generative artificial intelligence like Midjourney poses a problem. threat to the industry.
Shutterstock shareholders can choose to receive $28.80 per share in cash, or 13.67 Getty shares, or a combination of 9.17 Getty shares and $9.50 in cash for each Shutterstock share they own. The offer represents a value of more than $1 billion, according to Reuters calculations.
Shutterstock shares rose 22.7%, while Getty shares rose 39.7%. Shares of both companies have declined for at least the past four years, as the growing use of mobile cameras reduces demand for stock photography.
Getty CEO Craig Peters will lead the combined company, which will have annual revenues of nearly $2 billion and will benefit from Getty's large library of visual content and the strong community on the Shutterstock platform.
Peters downplayed the impact of ai on Tuesday and said he was confident the merger would receive antitrust approval in both the United States and Europe.
“We don't control the timing (of approval), but we have great confidence. This has been a situation where customers have had no choice. They have always had a choice,” he said.
Some experts say President-elect Donald Trump's recent appointments to the Justice Department's Antitrust Division indicate there would be little change to the tough scrutiny that has come to define the regulator in recent years.
“With Gail Slater at the helm, the antitrust division will be much more aggressive under this Trump administration than it was under the first one,” said John Newman, a law professor at the University of Miami.
Regulators will examine how the deal affects the old-school business model of selling images to traditional media clients, as well as the new business model of offering copyright-compliant generative ai applications to the public.
The deal is expected to generate up to $200 million in cost savings three years after closing. Getty investors will own about 54.7% of the combined company, while Shutterstock shareholders will own the rest.
Getty competes with Reuters and the Associated Press in providing photographs and videos for editorial use.
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