Meta sells Giphy to Shutterstock at a loss in a $53 million deal
Meta acquired the popular platform in 2020 for $315 million but was ordered to divest the company by the U.K.'s competition authority.
Aliver
The logos of Facebook and Giphy.
Aytac Unal | Anadolu Agency via Getty Images
The online stock-photo marketplace Shutterstock announced Tuesday it would acquire Giphy from Meta Platforms for $53 million, a significant loss for Meta, which acquired Giphy in 2020 for $315 million.
The acquisition is an all-cash deal, and in an investor presentation, Shutterstock said it would maintain its full-year revenue guidance. The acquisition would add "minimal revenue in 2023," Shutterstock noted.
The deal is expected to close in June. Shutterstock's shares rose nearly 2% in morning trading Tuesday.
U.K.'s Competition and Markets Authority had ordered Meta to divest Giphy in 2022, citing potential anti-competitive effects. The CMA disclosed it was probing the deal in June 2020.
Giphy, which is a platform for searching for and using animated images in messaging apps, was well-integrated into Meta's ecosystem, and had been an acquisition target for the social-media company years before Meta acquired it in 2020.
Technology acquisitions have faced heavy scrutiny from the U.K.'s anti-trust authority in recent months. The CMA blocked Microsoft's proposed $69 billion acquisition of Activision in April, citing potentially adverse effects to the cloud gaming industry.
Like many technology companies, Meta has faced stiffening regulatory oversight in the U.S. as well. The FTC proposed a "blanket" ban preventing Meta from monetizing young user's data and alleged Meta had violated a 2020 privacy order. In a statement, Meta described the FTC effort as a "political stunt."
"We are grateful to the Giphy team during this uncertain time for their business, and wish them every success," a Meta spokesperson told CNBC at the time of the divestiture order.
