Last week, the Competition and Markets Authority (CMA) cleared the Getty/Shutterstock merger subject to one structural remedy: Shutterstock must divest its editorial business, Splash and Backgrid, before the deal closes.
According to Shutterstock’s 2025 annual report, the editorial business (including Rex, Splash and Backgrid) made around $32 million per year. The transaction was worth approximately $3 billion (before the stock price collapsed).
The remedy is, in other words, roughly 1% of deal value. But it raises an uncomfortable question for both the parties and the CMA. Why did it take so long to agree on a remedy that the parties suggested at the end of Phase I? Arguably, the parties have lost more money during the Phase II investigation due to the stock price collapse, interest on credit lines, and even legal fees than the divested businesses are worth.
A Remedy Built From the Parties’ Own Words
The CMA’s logic for the editorial divestiture is worth reading carefully, because it is constructed almost entirely from the parties’ own submissions.
Throughout the investigation, Getty and Shutterstock argued that the editorial business was peripheral to Shutterstock’s core operations, that it contributed limited revenue globally, and that the merger’s $150–200 million in annual synergies would survive without it. These arguments were made to minimise the competition concern — to demonstrate that the overlap in editorial stock imagery was not significant enough to warrant a serious remedy.
The CMA listened. Then it used every one of those arguments to justify ordering the divestiture.
The CMA noted that the parties had described the editorial business as peripheral, pointed to its limited contribution to global revenues, and confirmed that the deal’s synergies would largely be preserved by the divestiture, and therefore concluded it was a proportionate remedy that the parties themselves had effectively pre-validated.
The parties submitted an almost identical remedy at the end of Phase 1, but it wasn’t enough then. During Phase 2, the parties reduced the scope of the remedy, but the regulator wasn’t happy with that reduction and came back to the one suggested by the parties earlier.
So after this tug of war to define the scope of the remedies, which is by far the biggest part of the decision with almost 100 pages, the differences between the parties seem to lie on part of the editorial business (Rex Features), which accounts for $12 million in revenue per year.
S&P Global Confirms What the Financials Already Showed
S&P downgraded Getty Images to ‘B’ from ‘B+’ and placed the rating on CreditWatch Negative. That means a further downgrade is on the table. The agency cited leverage above 7x, negligible cash flow generation, and a liquidity position that has deteriorated materially over the past year.
Getty drew $120 million from its revolving credit facility to cover litigation payments and interest costs totalling $110 million. S&P notes explicitly that Getty may require external debt or equity to avoid a liquidity crisis if the merger does not close.
Shutterstock is not in better shape. Its revenues declined 18% in Q1 2026 alone. Getty’s own full-year revenue guidance sits at a midpoint decline of approximately 2%.
As we noted in our earlier analysis of this merger, the combined entity was always going to carry a meaningful debt load. What S&P’s downgrade confirms is that the standalone companies arrived at closing day in significantly worse financial condition than they entered the regulatory process. Leverage above 7x at Getty. A credit rating in speculative-grade territory with negative watch. The interest cost on the merged entity’s debt is not an abstract concern; it is a present obligation that must be serviced from cash flow that is, by S&P’s own assessment, negligible.
Finding a Buyer: Low Bar, Lower Price
Shutterstock must now find a buyer for its editorial business. The editorial stock photography market is not a hot sector. The secular shift toward user-generated content, AI-generated imagery, and smartphone photography has compressed margins across the industry. The strategic rationale for acquiring an editorial photography business in 2026 is not obvious.
According to the CMA’s decision, the parties reported interest from several companies and are already negotiating.
The more pressing constraint is not finding a willing buyer — it is completing the sale under a regulatory deadline, with a seller whose merger close is contingent on the transaction and whose balance sheet, as S&P has now confirmed, cannot afford delay. In distressed asset sales, the buyer knows the seller’s position. The price will reflect that bargaining position.
What If This Had Cleared Seven Months Earlier?
This is not a criticism of the CMA’s substantive analysis.
The question is whether the same outcome could have been reached faster, as the decision seems to suggest an agreement could have been possible, and how much this cost the companies.
The Phase 1 decision was announced on October 20, 2025, referred to Phase 2 on November 3, and the final decision came on May 16, 2026. Since the CMA announced Phase 2, Getty’s stock price has plummeted 57% (and this is considering the 15% upside after announcing the approval) and Shutterstock’s 38%. For Getty, this means a market cap loss of more than $400 million.
Shutterstock’s revenues had not yet entered the decline that produced the 18% drop in Q1 2026. The NYSE wouldn’t have notified Getty that its shares would trade OTC. The litigation payments had not consumed liquidity. The credit rating had not been cut.
Had the CMA cleared the deal conditionally at the end of Phase 1, Getty would have received Shutterstock’s $162 million cash balance before drawing on its revolving credit lines, avoiding the liquidity squeeze that S&P now identifies as the primary near-term risk. The $150–200 million in annual synergies would be further along the realisation curve. Shutterstock’s revenue decline might have been less severe. All this may have had a much bigger impact than trying to save part of a business that makes around 1% of the revenue, and the negotiation would probably only save a fraction of that (Rex Features, $12 million per year).
None of this means the CMA was wrong to investigate thoroughly. It simply puts the spotlight on how worthy it is for the parties to litigate over the scope of a remedy when a possible win is less than the negative impact of a drawn-out merger investigation. In this case, the difference is noticeable, and not for good.
That is the uncomfortable arithmetic of this outcome. The regulator spent seven additional months arriving at a conclusion that the parties’ own Phase 1 documents had already supplied. The companies paid for that time in leverage, liquidity, credit ratings, and shareholder value. We still need to see how much the companies will get for the divested business. But the merged entity begins its life together on CreditWatch Negative, with S&P explicitly flagging the risk that even the post-merger combined entity may not meet the financial thresholds needed to affirm a ‘B’ rating.
