DC-based media company Axios announced Monday it has signed a deal to sell to recent investor Cox Enterprises. The cash deal is valued at $525 million and will ensure investments continue to fuel local news.
This news follows Axios’ November funding round led by Cox which valued the company at $430 million.
Founded in 2016 by Politico leaders, Axios is a news site that focuses primarily on politics, tech and business. It’s known for its local coverage and simple and concise format. Considering Cox’s history, which got its start in local newspapers, the acquisition seems like a good fit.
“This is great for Axios, for our shareholders and [for] 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,” Axios CEO Jim VandeHei said in a statement.
The acquisition included an additional investment of $25 million from Cox which will be injected into Axios’ media branch to accelerate expansion across its local, national and subscription news products. Axios says it expects to reach $100 million in revenue by the end of the year.
Once the deal is finalized, Axios’ management will maintain editorial control, according to a company statement. The acquisition deal is also designed to incentivize current Axios employees to stay with the media outlet, counter to what tends to happen with acquisitions where employees are sometimes laid off post-deal closure.
“A big part of this investment is to expand the number of local markets we serve. Local watchdog journalism is so important to the health of any community, and no one is more focused on building that out nationally than Axios,” Cox chairman and CEO Alex Taylor said in a statement.
When it comes to the company’s software arm, Axios HQ will spin off into its own stand-alone company. The new company will be led by Axios president Roy Schwartz and leave Axios with some seed capital. Axios HQ plans to raise additional funds early next year, according to a company statement.