Getty Images is set to abandon its $3.7 billion merger agreement with Shutterstock after the UK Competition and Markets Authority imposed conditions that would force Shutterstock to sell its global editorial business, including the Backgrid and Splash paparazzi agencies. The decision comes despite the US Department of Justice granting the deal unconditional antitrust clearance in February.
UK Regulator Conditions Prove Unacceptable
In a US Securities and Exchange Commission filing published on Tuesday, Getty Images stated it is not required to accept the approval conditions outlined by the UK regulator in May. These conditions require Shutterstock to divest its entire global editorial business, a move that has proven unappealing enough for Getty to walk away from the merger. The company's board of directors unanimously voted to terminate the merger agreement on July 6th, assuming no material change in circumstances occurs before July 7th.
Impact on Stock Photo Industry
The merger aimed to combine the stock photo libraries of Getty Images and Shutterstock, creating a dominant player in the industry. However, both companies face increasing competition from AI image generators that provide fast and cheap media content on demand. The collapse of the deal leaves both companies to navigate this competitive landscape independently.
UK Regulators Have Killed Similar Deals
Pressure from UK regulators has derailed major tech deals in the past. Meta was ordered to unload Giphy in 2021 over competition concerns, which it subsequently sold to Shutterstock in 2023. This history underscores the significant influence of UK antitrust authorities on global mergers and acquisitions.
