Daily Mail and General Trust has cut its losses on the viral video-sharing website Elite Daily by selling it to Bustle Digital Group for an undisclosed price.
The move, which was announced on Monday in New York, comes as the Daily Mail’s parent company continues to review its portfolio of companies, which also includes data and exhibition businesses.
In December the publisher announced it was cutting its stake in the financial information service Euromoney in a move that could raise more than £300m. The company’s chief executive Paul Zwillenberg has said there would be “no sacred cows” as he conducts his strategic review.
DMGT bought Ellite Daily for £17.6m in January 2015 to try and capitalise on the site’s popularity with younger audiences on Facebook. Reports at the time of the acquisition valued the deal at between $40m and $50m.
But at the end of last year, DMGT wrote down the value of the business, resulting in an impairment charge of £25m.
Elite Daily, founded in 2012, brands itself the voice of generation Y and grew fast by developing viral content which attracted big audiences through sharing on social media. As Facebook and other platforms have grown their own audiences by hosting content directly on their site, however, websites like Elite Daily have struggled.
DMGT said in December that while revenues had grown by 44 per cent “audience retention and revenue growth have been disappointing and losses have exceeded expectations”.
Announcing the deal with Bustle, a digital media company focused on young women, DMGT said the sale of Elite Daily was “another step in delivering a more streamlined group, unlocking value across the portfolio”.
The group added that the sale would move Mail Online, the world’s biggest English language news site with over 240m monthly users, a “significant step closer to profitability.”