Byron Allen, the comedian turned entrepreneur, is buying a controlling stake in BuzzFeed, the digital media company that pioneered virality on the internet.<\/p>\n
Allen Family Digital, a company associated with Mr. Allen, will pay $120 million for a 52 percent stake in BuzzFeed, the companies said on Monday. Mr. Allen will become chief executive and chairman of BuzzFeed, replacing Jonah Peretti, the company\u2019s founder, who will become president of artificial intelligence.<\/p>\n
Mr. Allen, 65, will remain chief executive of Allen Media Group, a news and entertainment company that owns local TV stations, the Weather Channel and a TV production arm. Allen Media Group produces \u201cComics Unleashed,\u201d which will replace Stephen Colbert\u2019s \u201cLate Show\u201d on CBS at the end of the month.<\/p>\n
The deal will end a two-decade run atop BuzzFeed for Mr. Peretti, 52, who founded the company in 2006 as an experiment in a small office in New York City\u2019s Chinatown. The company\u2019s valuation bloomed a decade ago as BuzzFeed became synonymous with the future of media, then crashed as streaming supplanted digital publishing. Disney offered to buy BuzzFeed in 2013 for $650 million, an offer Mr. Peretti rejected.<\/p>\n
Mr. Peretti decided to sell this time as BuzzFeed grappled with serious financial pressure. The company told investors this year that it was at risk of not continuing as a business as it struggled with $58.4 million in debt and millions in annual losses. Mr. Peretti said experiments with artificial intelligence were a bright spot for the company, and he oversaw the creation<\/a> of interactive games made with the technology.<\/p>\n Mr. Peretti said on an earnings conference call on Monday that BuzzFeed was planning a round of cost-cutting, adding that the company would set up its film and TV division as an independent entity. He said stepping down as chief executive would allow him to play \u201ca more hands-on role developing products and technology.\u201d<\/p>\n \u201cI\u2019m confident I can have a bigger impact and create more value in this new capacity,\u201d Mr. Peretti said.<\/p>\n BuzzFeed said in a news release that the deal would be financed with $20 million in cash at closing, with Allen Family Digital paying an additional $100 million within five years at a 5 percent interest rate. The deal is expected to close at the end of this month.<\/p>\n On the conference call, Mr. Allen said he planned to expand BuzzFeed\u2019s efforts in streaming and user-generated content, an industry term for video not made by company employees. He also said BuzzFeed would add local coverage to its national and international news articles on HuffPost, a site BuzzFeed bought in 2020.<\/p>\n \u201cAs of this moment, BuzzFeed is officially chasing YouTube and the other big tech platforms,\u201d Mr. Allen said.<\/p>\n BuzzFeed is just the latest acquisition for Mr. Allen, who has forged a media empire by buying properties including local TV stations and networks focused on niches like criminal justice, pets and automobiles. A distribution deal he sought with Comcast turned litigious when Mr. Allen accused the cable giant of discriminating against networks controlled by minorities. The case was settled, and Mr. Allen ultimately locked in distribution for some of his networks.<\/p>\n