New York Times to Buy the Athletic in $550 Million Deal

(Bloomberg) -- The New York Times Co. agreed to buy the Athletic, acquiring a sports-news website with more than 1 million subscribers.

The newspaper publisher is paying $550 million for the Athletic, which will remain a standalone product, Times Chief Executive Officer Meredith Kopit Levien said Thursday in a statement. The deal is expected to close by the end of March.

“Strategically, we believe this acquisition will accelerate our ability to scale and deepen subscriber relationships,” she said.

The Times has more than 8 million paid subscriptions across its digital and print products. The publisher is “now in pursuit of a goal meaningfully larger than 10 million subscriptions” and believes “The Athletic will enable us to expand our addressable market of potential subscribers,” Levien said.

While the purchase will add to revenue growth immediately, the Times expects the acquisition to reduce its operating profit for about three years.

Started six years ago, the Athletic established itself by poaching big-name sports writers from news outlets across the country, including Ken Rosenthal in baseball and Shams Charania in basketball.

The Athletic's co-founder, Alex Mather, told the New York Times in 2017 that, “We will wait every local paper out and let them continuously bleed, until we are the last ones standing. We will suck them dry of their best talent at every moment.” He later apologized.

The company raised about $50 million two years ago at a valuation of around $500 million. In November, it had about 1.2 million subscribers who pay for access to articles about major professional sports teams in the U.S., as well as professional soccer teams abroad. In June 2020, the Athletic cut 46 employees, or 8% of its staff.

The Athletic also held talks with the online news site Axios. Negotiations broke down over a range of issues, including price and who would lead the combined company, according to people familiar with the matter.

The deal with the Times was reported earlier Thursday by the Information.