The Carlyle Group (
NASDAQ: CG) and Getty Images management announced today they have formed a partnership to acquire Getty Images, Inc., from Hellman & Friedman for $3.3 billion. Carlyle will acquire slightly over 50% of the company. Getty Images Co-Founder and Chairman Mark Getty and the Getty family will roll substantially all of their ownership interests into the transaction. CEO and co-founder Jonathan Klein will also invest equity in the company.
In 2011 Private Equity Investments ranked The Carlyle Group as the third largest private equity firm in the world with some $156 billion under management diversified over 99 distinct funds. The firm has struck 19 deals worth nearly $14.1 billion over the last 12 months and currently tops the Thompson Reuters rankings of acquisitions by private equity firms. In its history The Carlyle Group has made more than 950 investments.
Carlyle will make the investment in Getty Images out of its Carlyle Partners V fund, a $13.7 billion pool that began investing in 2007. Last week Carlyle said the fund had a net internal rate of return of 9 percent as of June 30. Other investments in the fund include BankUnited Inc., Booz Allen Hamilton Inc. and HD Supply Inc. The transaction is subject to customary regulatory approvals and is expected to close later this year.
Hellman & Friedman bought Getty Images and took it private in 2008 in a deal valued at $2.4 billion. H&F has taken out dividends of at least $950 million. It paid $34 per share for Getty's outstanding shares and took on about $300 million in debt.
Carlyle Group reported that Getty Images had over 80 million images in its collection. About 5.6 million of those are included in Getty’s Creative Stock Images collection and licensed at Rights Managed and Traditional Royalty Free prices. Another 10 million are licensed at Microstock prices through the iStockphoto brands. The bulk of the remainder are editorial and historic images. Getty says it has about 1.3 million customers per year, but it is unclear how many of those are unique customers.
Mark Getty added, “In seventeen years, we have built a business that has revolutionized the industry, with innovation at its core. I am confident that the partnership between Getty Images and The Carlyle Group will see the company’s success continue.”
“We will harness Carlyle’s financial resources and global network to help take Getty Images to the next stage of product innovation and global growth,” Eliot Merrill, a managing director in Carlyle’s telecommunications and media group, said in the statement.
For more background on the acquisition check out this
previous story.