Axios and the Athletic talking merger

Axios and subscription-based sports media company the Athletic are discussing merging and creating a larger digital media company, The Wall Street Journal reported Friday.

Under the deal, the Athletic and Axios would remain separate brands employing their own editorial staff and creating separate editorial products, the Journal reported. The Journal did not report who might lead the newly formed company.

Talks have only recently begun and the Journal reported a deal could still not materialize. 

“We have long been admirers of The Athletic business and content,” Axios CEO Jim VandeHei said in an emailed statement to The Hill. “We have talked for literally years about our shared passion for premium content businesses. That said, we would never comment on private discussions about possible partnerships or deals.”

A spokeswoman for The Athletic would not comment on the WSJ report but did say the two companies had “enjoyed many conversations over the years.”

The larger strategy to build a media company may involve the formation of a special purpose acquisition company, or SPAC, a corporate structure formed solely to raise money through an initial public offering, the Journal reported.

According to a presentation seen by the Journal’s sources, the SPAC would raise money to fund expansion and the acquisition of other companies. The acquisition targets would include publishers that produce content consumers pay for and that earn premiums from advertisers.

The talks started approximately a week ago, after Alex Mather, the CEO of The Athletic brought a merger deal to VandeHei, the Journal reported, based on talks with sources familiar with the events.