Scoop: CVC eyes Group Black's bid for Bustle-owner BDG
CVC Capital Partners is looking to partner with Group Black on its bid to buy BDG Media, according to sources. Fellow private equity giant Blackstone has also eyed a role in Group Black's pursuit of BDG, sources say.
Why it matters: The private equity interest in the BDG process adds serious weight to the acquisition effort and puts another spotlight on the media company after it abandoned efforts to pursue a SPAC.
Details: CVC would provide Group Black with the equity needed to acquire BDG, formerly known as Bustle Media Group, if Group Black ultimately decides to move forward with an offer, the sources said.
- Precise details of Blackstone's potential role was not immediately clear, though one source said the talks are no longer live.
- While Group Black and BDG have been in talks for months about a deal, sources told Axios that Group Black is still weighing the value of BDG Media's business in a toughening economic climate.
- Group Black is a media collective that's looking to get marketers and ad agencies to shift more of their ad spending to Black-owned media outlets. In addition to its pursuit of BDG, Group Black is looking to acquire more digital media assets — a move CVC would also seek to partner on, sources say.
Of note: BDG Media relies heavily on advertising across its portfolio of over a dozen media brands.
- The company was looking to go public via a SPAC last year in a deal that would value it at around $600 million, including debt, but sources say commanding that valuation in this economic environment would be challenging, given the broader ad market slowdown.
Catch up quick: The Wall Street Journal reported in June that Group Black was looking at potential acquisitions in the digital media space, including interest in buying a majority stake in BDG.
- The story did not mention CVC or any other partner.
- Like any transaction, Group Black could decide back away and CVC could decide not to participate.
- All companies and private equity firms mentioned in this article declined to comment.
The big picture: Consolidation in the digital media space is rampant as more startups look to return venture investments to investors.
- For companies like BDG, which explored a SPAC post-pandemic, private sales to an acquirer now seem like a better alternative.
- The advertising market slowdown has caused many digital media publishers to rethink their near-term financial strategies.
Editor's note: The story has been updated to reflect additional reporting that showed Blackstone is no longer pursuing a role in the potential transaction.