Getty Images Holdings Inc. has reached an agreement to acquire rival Shutterstock Inc., creating a new company valued at $3.7 billion, including debt. The deal marks a significant milestone in the licensed visual content market and signals a rapidly changing industry.

Under the deal, Getty Images will offer Shutterstock shareholders a cash payment of $28.85, or approximately 13.67 Getty Images shares for each Shutterstock share. Shutterstock shareholders will also have the option to choose a combination of cash and Getty Images shares. The payment will be $331 million in cash and 319.4 million Getty Images shares.

Upon closing, Getty Images shareholders will own 54.7% of the combined company, with Shutterstock owners owning the remainder. Getty Images CEO Craig Peters will lead the new company, which will combine two of the largest providers of licensed visual content in the United States.

The deal is strategically important given the changes in the content market caused by the development of artificial intelligence and the availability of images through smartphone cameras. The combination will create a huge library of Getty Images photos, illustrations and videos and integrate it with the Shutterstock platform, which will allow creators to upload their own content.

It is worth noting that Getty Images, which currently has about $ 1.4 billion in debt, has lost about 73% of its market value since going public in July 2022. At the same time, Shutterstock shares have fallen by 50% during that period. However, after the announcement of the deal, Shutterstock shares rose by 44% in the pre-market session, while Getty shares rose by 100%.

The companies hope that the merger will reduce costs, improve profitability and offer an expanded set of services for the media, advertising and content industries, which could significantly impact the further development of this sector in the face of increasing competition and technological change.