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Getty Images (GETY) and rival Shutterstock (SSTK) have agreed to merge in a $3.7 billion U.S. deal that will create a photograph and image giant.
The two companies, which each specialize in stock photographs used primarily by the news media, say they are merging to achieve economies of scale and fend off the threat posed by artificial intelligence (A.I.).
Should the merger succeed, the new company will be named “Getty Images Holdings Inc.” and will continue to trade on the New York Stock Exchange under the ticker symbol “GETY.”
Additionally, Getty Images’ chief executive officer (CEO) Craig Peters will lead the combined company.
However, several analysts on Wall Street appear skeptical of the deal, saying it is likely to attract regulatory scrutiny and could be rejected based on antitrust concerns.
Getty Images and Shutterstock each compete against news outlets such as Reuters (TRI) and the Associated Press to provide photos, images, and videos for editorial use.
The two companies photographs and images are also widely used by graphic designers and other creative professionals.
Shutterstock’s shares are up 10% and the stock of Getty Images is up nearly 20% on news of the proposed merger.
Over the last 12 months, Shutterstock’s share price has declined 39% to trade at $30.05 U.S.
The stock of Getty Images has fallen 52% over the same period to trade at $2.57 U.S. per share.
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