Meta Sells Giphy to Shutterstock at a Significant Loss

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by Anna Munhin May 24, 2023 News
Meta Sells Giphy to Shutterstock at a Significant Loss

Three years after acquiring Giphy for $400 million, Meta has found a new buyer.

In an announcement today, Shuttershock confirmed it was purchasing Giphy in a cash transaction that "consists of 53 million of net cash paid at closing."

Meta will sign an agreement to ensure its platforms get continued access to Giphy content once the deal closes next month.

Why Did Meta Put Giphy Up For Sale?

Meta isn't willing to let Giphy go. The GIF search engine would struggle to survive as an independent business and there wasn't much interest in potential buyers.

The tech conglomerate was forced to sell. The sale of Giphy to Meta was blocked by the Competition and Markets Authority in the UK due to antitrust concerns. According to the grounds for the legal action, the merger reduced competition.

The UK's antitrust authority has issued a final order for the sale after Meta's appeal processes held up a ruling for several months.

Are GIFs Not Cool Anymore?

Meta's last-ditch appeal to the CMA to stop a forced sale was a low blow to the art form that is a Gif. According to the company, GIFs arecringe, for boomers, and are no longer a relevant form of content due to their fall out with younger users.

The acquisition isn't going to make a lot of waves, with the minimal revenue likely to come from it. It's a step in the right direction to bolster their creative offering.

“[It’s] an exciting next step in Shutterstock’s journey as an end-to-end creative platform. Through the Giphy acquisition, we are extending our audience touch points beyond primarily professional marketing and advertising use cases and expanding into casual conversations.” – Paul Hennessy, Shutterstock Chief Executive.

The deal will help strengthen its creative suite, as well as speeding up its moves into generative artificial intelligence.

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