Getty Images Owners Consider Sale or IPO

Posted on 5/23/2012 by Jim Pickerell | Printable Version | Comments (1)

Hellman & Friedman, the owners of Getty Images Inc, have retained Goldman Sachs Group Inc and JPMorgan Chase & Co to examine a possible sale or public offering of the business.

This move follows announcements last week by Shutterstock and Fotolia. Shutterstock hopes to raise $115 million in its IPO and Fotolia received a $150 million growth investment from Kohlberg Kravis Roberts & Co. (KKR) for a 50% stake in the company

Hellman & Friedman originally invested up to $941.3 million equity as part of a $2.4 billion leveraged buyout of Getty Images in 2008. Most of H&F’s investment has already been returned through a $496 million dividend paid in October 2010 and another $379 million paid earlier this year. Getty Images has outstanding loans of $275 million on a first-lien senior secured term loan due to be paid back in November 2015 and a $1.245 billion first-lien term loan due November 2016.

There are rumors that prior to this announcement KKR offered Getty Images $1.5 billion for the iStockphoto brand. This would have left H&F owning all the rest of the company. Getty made a counter offer of $2.2 billion and KKR did not respond. According to press reports a sale or IPO could value Getty Images at $4 billion.

In 2011 Getty’s gross revenue was $945 million according to Moody’s Investor Service. The company’s EBITDA (earnings before interest, taxes depreciation and amortization but after all expenses have been deducted from gross revenue) margin was 35.6% up from 33.2% in 2010. Getty was able to achieve an increase in EBITDA by cutting photographer royalty rates at the beginning of 2011 and by overall cost cutting.

In a recent interview with the Financial Times Getty CEO, Jonathan Klein said that since its founding in 1995 the company has made over 120 acquisitions. They currently have over 300 image partners and represent the work of over 120,000 individual photographers and filmmakers.

In discussing how the business has changed since he took over in 1995 Klein noted that the biggest change is in the size of the market. “In 1995 the only people we could sell to were print publications. Now we are in a world where we have billions of pages. When I started in the business our biggest customer (a textbook publisher) would buy 1,000 pictures a year. Now we have customers who are buying 10,000 pictures a week,” he added. “The prices have come down, but the volumes are significantly larger. Also we have been able to sell products to folks you would have never imagined would be able to use that product. The best example is that educational textbook publishers now are putting a lot of what they do online so we’re selling video to textbook publishers that we would not have been able to do before.”

Copyright © 2012 Jim Pickerell. The above article may not be copied, reproduced, excerpted or distributed in any manner without written permission from the author. All requests should be submitted to Selling Stock at 10319 Westlake Drive, Suite 162, Bethesda, MD 20817, phone 301-461-7627, e-mail: wvz@fpcubgbf.pbz

Jim Pickerell is founder of, an online newsletter that publishes daily. He is also available for personal telephone consultations on pricing and other matters related to stock photography. He occasionally acts as an expert witness on matters related to stock photography. For his current curriculum vitae go to:  


  • Ottmar Bierwagen Posted May 29, 2012
    What goes around goes around again. Getty originally ponied up about $8 billion in accumulating his enormous library, then went public, and then sold off when the shares went down. Now Getty Images is private wanting to go public AGAIN. Profit is up due to the shabby treatment of photographers who are leaving in droves.
    Where is Tony Stone when needed?

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