Audio-streaming service Spotify Technology (SPOT) - Get Report will purchase sports and lifestyle company The Ringer for $250 million, a media report says.
The structure of the deal pays The Ringer $200 million up front with another $50 million later, a person familiar with the matter told Bloomberg.
The company has not made the particulars of the deal public, but Bloomberg’s source says the company is expected to detail the costs in a regulatory filing soon.
Spotify said Feb. 5 that it had definitively agreed to acquire The Ringer, which was founded by the sportswriter, analyst and author Bill Simmons in 2016.
"The Ringer will bring to Spotify its industry-leading sports and entertainment team, podcast catalog and website," expanding Spotify’s offerings and audience reach, the company said in a statement.
The transaction is expected to close in the first quarter.
Spotify’s announcement was part of its quarterly earnings release last week. The company reported a loss of about $230 million, or $1.26 a share, on sales of $2.05 billion. Analysts surveyed by FactSet were expecting a loss of 17 cents on revenue of $2.09 billion.
The company ended the year with 124 million premium subscribers, up 29% from the year earlier. Analysts were expecting 122 million paid subscribers. North America saw the fastest quarterly growth since fourth-quarter 2018.
Looking ahead, Spotify said it expected total premium subscribers to range 126 million to 131 million for the first quarter, compared with analysts' estimate of 128 million.
For full-year 2020, the company sees total premium subscribers ranging 143 million to 153 million.