Two major image licensing giants appear to be joining forces to combat AI invasion in the creative industry. Confirming the speculation, the Seattle-headquartered Getty Images today announced a merger with its biggest rival (until now) – Shutterstock – under a cash-and-stock deal. The combined entity will be named Getty Images Holdings, Inc. This new stock photo powerhouse is expected to be valued at around $3.7 billion. Craig Peters, the current CEO of Getty Images, will continue to lead the new entity after the merger.
Under the deal agreement, Shutterstock stockholders have a few options. They can choose to receive $28.85 per share in cash for each share of Shutterstock common stock they own. Alternatively, they can opt for 13.67 shares of Getty common stock for each share of Shutterstock common stock. In fact, a mixed option is also available. This includes 9.17 shares of Getty Images common stock plus $9.50 in cash for each share of Shutterstock common stock.
This newly formed combined entity was expected to record nearly $2 billion in revenue for 2024. Interestingly, approximately half of this revenue (~46%) was anticipated to come from subscription-based services. Meanwhile, the companies expect to achieve annual cost savings of $150–$200 million within three years of completing the merger.
The new entity will have a total of 11 board members. Apart from CEO Craig Peters, Getty will nominate six directors, while Shutterstock will designate four. The current Shutterstock CEO, Paul Hennessy, already has a confirmed seat on the board.
The new company will focus on generative AI capabilities. Going forward, it plans to expand event coverage, explore technologies like 3D imagery, and of course – AI.
“Today’s announcement is exciting and transformational for our companies, unlocking multiple opportunities to strengthen our financial foundation and invest in the future—including enhancing our content offerings, expanding event coverage, and delivering new technologies to better serve our customers,” said Craig Peters, CEO, Getty Images.
Notably, Getty owns brands like Getty Images, iStock, and Unsplash, while Shutterstock acquired Giphy in 2023. Getty Images – which made its public debut in 2021 -recorded annual revenues of $917 million in 2023 (a decline from $926 million in 2022). For Q3 2024, the company generated $240.5 million in revenue but reported a net loss of $2.5 million. Now, coming to Shutterstock, the firm reported revenues of $250.6 million in Q3 2024. However, its total revenue for 2023 was $874.6 million.
