Getty Images and Shutterstock to merge into $3.7 billion stock photo giant

Getty Images said Tuesday it had agreed to merge with rival Shutterstock in a stock-purchase deal that values the combined company at $3.7 billion based on yesterday’s share price. The announcement confirms previous Bloomberg reports.

Both companies offer stock photos and videos that can be licensed and reused. This content is commonly used by news outlets, feature and documentary filmmakers, advertising agencies, marketing companies, online and offline publishers, and many others.

Getty Images is the larger of the two, and its shareholders will own about 54.7% of the new company, while Shutterstock shareholders will own 45.3%. Getty Images also owns the paid photo hosting service iStock and the completely free Unsplash. The combined company will retain the Getty Images name.

As part of the deal, Shutterstock shareholders can decide whether they will receive $28 per share in cash, 13 Getty Images shares, or a combination of both.

Today’s move comes at a pivotal moment as neural networks are changing the landscape of the stock image industry. AI is both an opportunity and a threat, as Getty Images can license its content to AI companies so they can train their next-generation models. At the same time, its clients can choose to use generative AI tools like Midjourney, OpenAI, Dall-E, Runway ML to create images and videos tailored to their needs and forego some of the cost of purchasing licensed photos.

“Today’s announcement is exciting and transformative for our companies, opening up numerous opportunities to strengthen our financial foundation and invest in the future, including expanding our content offerings, increasing our event reach, and implementing new technologies to better serve our clients,” Getty Images CEO Craig Peters said in a statement.

Because of the size of the combined assets, this merger could attract the attention of the US antitrust authorities. It will be interesting to see how the Trump administration views this deal in the coming months.