Satirical news site the Onion has been sold to a private equity fund in a cut-price deal alongside a number of other news outlets including Gizmodo, Jezebel and Deadspin, reflecting growing industry concerns that many digital media companies have been substantially overvalued.
The sites, which were formerly owned by the Spanish-language media company Univision, consist of the former assets of Nick Denton’s Gawker business combined with spoof news outlets such as Clickhole.
The company was reported to have been offloaded to Great Hill Partners for under $50m, according to Recode, about a third of what Univision paid for it just three years ago. Since then investors have soured on digital media companies, many of which have struggled to match substantial audiences built on the back of Facebook and Twitter.
Companies such as BuzzFeed, Vice, and HuffPost owner Verizon Media Group, have been forced to make substantial cuts to staffing levels in order to reduce costs and reassure nervous investors that the businesses have a sustainable future.
The decision marks an end to an attempt by Univision, whose core audience is older Hispanic viewers of its traditional television channels, to enter the English-language youth news marketplace. The company said it would now “return to its core strengths in Hispanic media and marketing”.
Univision acquired most of the Gawker Media sites via a bankruptcy auction in 2016, after the network of online news sites posted a sex tape of the former wrestler Hulk Hogan. Hogan then sued, winning a landmark case in a Florida court, while being secretly backed by the billionaire Facebook board member Peter Thiel, who had held a longtime grudge against Gawker.
Jim Spanfeller, a veteran media executive who will oversee the new business under the banner of G/O Media, suggested there would be increasing pressure to make the businesses pay. He said that while he acknowledged editorial independence was “critically important”, there needs to be a “healthy and productive partnership with the business side for the company to be truly successful”.