The New York Times is looking into a potential acquisition of The Athletic, three sources familiar with the matter tell Axios.

Driving the news: Sources say the Times approached The Athletic following a report about a potential deal between The Athletic and Axios in March.

• The Wall Street Journal reported in May that The Athletic and Axios are no longer in talks for a potential merger via SPAC, and that The Athletic viewed The Times as a better contender for a merger.

The Times has been reaching out to former employees to vet The Athletic's business and culture, sources say.

• The Times is eyeing a full acquisition, not a joint venture or strategic partnership.
• The Athletic raised $50 million last year in a Series D funding round, just before the pandemic, putting its latest valuation at around $500 million.

By the numbers: Sources say The Athletic has about 1.2 million subscribers, some on discounted rate plans.

• The company did around $80 million in revenue last year, sources say, confirming a report from the Wall Street Journal. It isn't profitable.
• The Athletic employs about 600 people full-time, including around 400 editorial staffers.
• Both The Athletic and the Times suffered from the pandemic early on. The Times laid off 68 people, mostly in advertising, last June. But its business still saw explosive growth, thanks in large part to a newsy election year.
• The Athletic laid off 46 people last June, but ended up hiring about double that number back last year, according to one source. Most of the hires were across business operations and marketing, as live sports began to reemerge.

The big picture: The deal would help bolster the Times' subscription strategy, especially if it were to one day bundle its existing subscription offerings.

• The Times has nearly 8 million total paid subscribers, with nearly 7 million paying for just digital products. It's on pace to meet its goal of 10 million digital subscribers by 2025.
• The Times could possibly include The Athletic's sports subscription business as part of a larger subscription bundle.
• The Times sells subscriptions around its core news product, games, cooking and audio. It's currently testing subscription offerings for its consumer reviews site, Wirecutter, as well as NYT Kids.

On an earnings call earlier this month, Times CEO Meredith Kopit Levien noted that these types of ancillary subscription products, "combined with the differential value and demand advantages of our core news product ... should enable The Times to become a larger and more profitable business as we scale."

• Amid the Biden era, more of the Times' new subscriber growth has been weighted towards non-news products than ever before.

A New York Times spokesperson told Axios: "As a general matter of policy, we do not comment on rumors about potential acquisitions or divestitures."

• The Athletic declined to comment on the record.

Between the lines: The Times isn't the only company to have had conversations with The Athletic.

• Vox Media also had talks with the company about a deal, according to two sources familiar with the matter.

Yes, but: The Times has a mixed track record when it comes to deals.

• It bought the Boston Globe for $1.1 billion in 1993, only to sell it for around $70 million in 2013.
• The Times bought About.com in 2005 for $410 million in cash, only to sell it to Barry Diller's IAC for about $300 million in cash seven years later.
• In 2016, the Times acquired two marketing agencies, HelloSociety and Fake Love. Both have since folded.
• It also bought Wirecutter in 2016, reportedly for more than $30 million. That deal is seen as a success.
• Its more recent acquisitions of Audm and Serial Productions were much smaller in scope than something like The Athletic.

Our thought bubble: If the Times were to proceed with a purchase of The Athletic, it could do so with stock.

• The Times' stock is generally performing at its highest levels since the early 2000s. At $7.11 billion, its market cap is about 14x The Athletic's latest valuation.

Editor's note: This article has been corrected to note that The Athletic has not hired bankers.