Binance, the world’s largest cryptocurrency exchange by trading volumes, has made a strategic investment of $200m in the 104-year old magazine, Forbes, in a bid to improve consumer understanding of cryptocurrencies and blockchain. Forbes, founded in 1917, was for decades family-owned with a name made, covering the titans of the business world. But as with many in the media industry, its transition from print to digital has been rocky. In 2013, the Forbes family put the business up for sale and Hong Kong-based Integrated Whale Media acquired a majority stake.
In August last year, Forbes said it would list publicly on the New York Stock Exchange via a merger with Magnum Opus, a firm established to buy companies looking to go public. The firms said the deal, which valued Forbes at roughly $630m and is expected to be finalized within weeks, would come with a $400m investment by other partners.
Binance becomes a major Stakeholder
According to Forbes CEO Mike Federle, the investment from Binance will help the firm get experience, network, and resources of the world’s leading crypto exchange and one of the world’s most successful blockchain innovators. With Binance assuming existing PIPE commitments, the overall size of the PIPE will remain at $400 million, and Binance’s investment will be substantially the same terms as the existing PIPE investors.
The exchange will replace half of the commitments made by institutional investors worth $400 million, making Binance the second-largest owner of Forbes after the public listing. Forbes aims to be listed on the New York Stock Exchange under the ticker “FRBS.” In addition, Binance will receive two directors out of the nine total board seats as Binance’s chief communications officer, Patrick Hillmann and head of Binance Labs Bill Chin will join the Forbes board of directors.
What Binance CEO said about its Strategic Move
Binance founder and CEO Changpeng Zhao emphasized the importance of supporting media in the crypto industry as part of the company’s commitment to boost consumer knowledge and adoption of crypto, stating this;
“As Web3 and blockchain technologies move forward and the crypto market comes of age, we know that media is an essential element to build widespread consumer understanding and education.
We look forward to bolstering Forbes’ digital initiatives, as they evolve into a next-level investment insights platform.” However, a spokesperson for Binance told Cointelegraph that their investment in Forbes “would be the first investment of this kind” in the media industry, adding: “Web2 had a profound impact on the media sector. We believe that Web3 may have an equally important role to play in the future of journalism and publishing.”
About 2 years ago, Binance sued Forbes and two of its writers in November 2020 after the publication of a story that claimed Binance “conceived of an elaborate corporate structure designed to intentionally deceive regulators”. Binance debunked this and called the story “false, misleading and highly defamatory” and claimed it had cost the business millions of dollars. The lawsuit was dropped by Binance in February last year.