Meredith and Dotdash merger would form lifestyle juggernaut

A deal between IAC, the internet holding company led by media mogul Barry Diller, and Meredith Corp., the magazine giant, would create one of the largest food, home and lifestyle media companies in the world.

Driving the news: The Wall Street Journal reported last week that IAC is in talks to acquire Meredith in a deal valuing the magazine company at over $2.5 billion.

• A source confirmed those talks to Axios, but did not confirm the price.
• The idea behind the deal, The Journal reported, would be to combine Meredith's roughly two dozen titles with the 14 titles owned by Dotdash — the internet publishing company that IAC created through the acquisition of About.com in 2012 — to create a lifestyle publishing behemoth.

Why it matters: IAC is known for building or acquiring companies and spinning them back out to the public market once they mature. (It recently did so with Vimeo in 2020, and before that, Match Group in 2019.)

• Dotdash is IAC's fastest-growing business, and drives more profit than most digital-native media companies.
• Analysts estimate that Dotdash alone is worth more than $2 billion. A combination of Dotdash and Meredith would give IAC unprecedented scale in lifestyle categories, especially food and home.

The two companies are also complementary in terms of their revenue streams.

• Meredith makes most of its money from subscriptions, newsstands, licensing deals, etc. (It sold its local TV business to Gray earlier this year for $2.7 billion to focus on digital and magazines.)
• Dotdash makes most of its money from search-based advertising, as well as commerce.

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