USA Today Owner Gannett to Buy Digital Marketer WordStream for $130M
WordStream, one of the veterans of Boston’s digital marketing sector, is being acquired by Gannett, the publisher of USA Today and a network of local newspapers around the country.
McLean, VA-based Gannett (NYSE: GCI) said it has agreed to pay $130 million in cash, net of cash acquired, plus up to $20 million in additional payouts if WordStream hits certain revenue targets over the next two years, according to a Gannett press release.
The deal seems to be a good one for WordStream’s investors, which include Baird Capital, Sigma Partners, and Egan-Managed Capital. WordStream had raised at least $25 million in equity funding, and at least $3 million in debt financing from City National Bank. The company was founded in 2007 by Larry Kim, who is now running MobileMonkey, a startup focused on artificial intelligence software for mobile marketing, according to his LinkedIn profile.
The WordStream acquisition is part of Gannett’s efforts to become more of a digital-focused company, as print media continues to decline and the company searches for new growth drivers.
Gannett said the WordStream acquisition will help boost its other data-driven digital marketing services, ReachLocal (acquired in 2016) and SweetIQ (purchased last year). WordStream’s cloud-based software helps businesses and ad agencies manage their paid search ads on Google and Bing and their social media ad campaigns on Facebook. Gannett said it expects WordStream to contribute $55 million in digital marketing services revenue to its business in the first year after the acquisition closes.
WordStream will keep its headquarters in Boston, Gannett said.