The New York Times on Thursday said it had reached a deal to acquire sports news subscription site The AThletic for $550 million which will be closed in the first quarter of 2022. Photo courtesy Ajay Suresh/Wikimedia Commons
Jan. 6 (UPI) -- The New York Times on Thursday announced an agreement to purchase sports news subscription site The Athletic for $550 million.
In a statement Thursday, the company said the acquisition of The Athletic is expected to close in the first quarter of 2022 as President and CEO Meredith Kopit Levien said the deal puts the paper in a position "to be a global leader is sports journalism."
The Athletic will continue to operate as a standalone site and will initially be offered as a separate subscription before ultimately being offered as part of a "broader Times bundle."
"The Times already provides distinctive sports coverage for a general interest audience as part of our core report," Levien said. "As a stand-alone product, The Athletic will enable us to offer much more -- extensive coverage for fans who seek a deep connection to and understanding of their favorite teams, leagues and players."
Alex Mather and Adam Hansmann, founders of The Athletic, described the acquisition as a "thrilling milestone."
"When we founded the company, we hoped to become the sports page for every city in the world," they said. "We're excited to continue serving our avid subscribers as we grow and scale with the help of the most important journalistic organization and the leader in digital subscription news."
The New York Times, which as of November said it had 8.4 million subscribers, said it believes the acquisition will aide in its pursit of achieving 10 million subscriptions.
The Athletic launched in 2016 and announced in late 2020 that it had accrued 1 million subscribers.
Amid declining subscription numbers in June 2020, The Athletic laid off 46 employees -- about 10% of its workforce -- and implemented salary cuts.
In 2021, The Athletic reportedly sought to market itself to buyers including The New York Times and Axios.
Earlier this year, the two companies had been engaged in negotiations for a deal but the talks broke down when the Times offered a price that The Athletic felt was too low, CNBC reported, citing a source familiar with the negotiations.
The Athletic then hired the investment firm LionTree to run a formal process, raising the price for the publication.
The source told CNBC that The New York Times is working to acquire niche, community-based journalism enterprises with high-interest audiences willing to pay subscription fees for reporting, likely setting its sights on sites specializing in science, tech and other interests in the future.