Axios To Expand Local Journalism; Sold To Cox Enterprises For $525 Million
Popular American news site Axios, founded in 2016 by former Politico journalists Jim VandeHei, Mike Allen and Roy Schwartz, has announced that it will be acquired by Cox Enterprises, a media conglomerate, for $525 million. Cox, which controls several news radio stations as well as local news television channels, acquired the company but left VandeHei, Allen, and Schwartz at the helm.
In 2020, Axios began its expansion into local news, and now operates small newsrooms in 24 American cities, with a $25 million investment into making sure that coverage expands. The company plans to expand its coverage into 30 U.S. cities by the end of 2022.
“This is great for Axios, for our shareholders and American journalism. It allows us to think and operate generationally, with a like-minded partner — and build something great and durable that lives long after we are gone,” VandeHei said.
In order to build its audience, Axios plans to use that investment to create a series of subscription products on topics including technology, politics and legislative policy. The company also plans to hire over 100 new reporters to cover the 2022 midterm election cycle and the 2024 general elections.
“The lesson of the digital era: Chase fads, fantasy and clicks, you fade or famish,” VandeHei said. “Chase a loyal audience with quality information, you can flourish.”
Though it will have a seat on the board, Cox Enterprises will not acquire Axios HQ. Axios HQ will become an independent company headed by Schwartz as chief executive officer. Axios HQ works on a consulting basis with internal and external corporate communications departments to make sure that those places are communicating with their shareholders efficiently. That company’s prospects are also bright: HQ projects that it will double in size over the next year and triple its revenue.
The deal values Axios at five times its projected revenue for 2022 ($100 million) in order to incentivize its current staff and board members to stay with the reporting conglomerate and grow its reach into over 100 U.S. cities, while getting “boots on the ground” to integrate Axios as not just digital journalism but as an essential part of American communities.
“Hopefully, with Politico first, and Axios today, we have shown a way for serious journalism to thrive in the digital era,” VandeHei said. “This country so desperately needs it.”
The deal is expected to close sometime within the next few weeks.
