The deal sees Discovery take a minority stake in, and enter into a strategic partnership with, the firm. Axel Springer will maintain its investment as the second largest shareholder.
New York-based Group Nine is made up of Thrillist Media Group, owner of men’s lifestyle site Thrillist.com; NowThis Media, a social and mobile-focused news company that claims to be the number one video news publisher on Facebook; and The Dodo, a site targeted at animal lovers.
With the deal, Group Nine will now also house Discovery’s digital network Seeker, along with its production studio SourceFed Studios.
Discovery said that the partnership with Group Nine will expand its “push into the digital network space targeting millennials” and includes a commercial agreement that will give advertisers ‘360 opportunities’ across linear, digital, social and live events.
Thrillist CEO, Ben Lerer now becomes CEO of Group Nine Media while Jens Müffelmann, president of Axel Springer USA and CEO of Axel Springer Digital Ventures, becomes board member.
As part of the investment, Discovery will have an option to buy a controlling stake in the company in the future.
“Today marks the start of a strong new company with tremendous brands, reach and scale,” said David Zaslav, president and CEO, Discovery Communications.
“The merger of these assets will bring together best-in-class management, led by Ben and his team, expertise in data analytics technology and global reach to create one of the world’s largest digital-first content companies attracting young passionate enthusiasts that advertisers want to reach.”
Ben Lerer said: “This is truly a ‘win-win’ scenario, allowing our brands the opportunity to remain independent and build our own future, while at the same time, having the support of one of the best media and entertainment companies in the world.
“Each of our brands has found great success independently, but with consolidation of digital content companies around the corner, there is extraordinary value in all existing under one multi-brand roof.”
Ben Lerer co-founded Thrillist with Adam Rich in 2005. His sister Izzie Lerer launched the Dodo in 2014. Father and Huffington Post co-founder Ken Lerer launched NowThis with former Huffington Post CEO Eric Hippeau in 2012.
Axel Springer’s Müffelmann said: “We are big believers in digital journalism and its very exciting business perspectives. We look forward to continuing to strengthen our relationship with the Lerer family through this transaction and to work with Discovery to support the growth of Group Nine Media.”