Ithaca Holdings, a newly formed entity, has struck a deal to take Bumble Inc. off public markets for $1.3 billion — a sum that represents only a portion of the valuation the dating-app company carried when it listed its shares in 2021, a period during which younger users have shown declining interest in such platforms.

A Tuesday statement put the acquisition price at $6.05 for each share held by Ithaca Holdings investors. Talks between the two firms over a possible buyout were reported to be at an advanced stage on Monday, though the broadcaster cited went unidentified.

At 138% above Bumble's share price at Friday's close — the final session before news organisations began circulating reports of a potential transaction — the acquisition price puts a steep premium on the company's pre-announcement valuation.

Once the transaction closes, Ravi Gupta and John Hegeman — who currently lead Ithaca Holdings as its two chief executives — are set to share the top role at Bumble under a co-CEO arrangement. Wolfe Herd, who founded Bumble, indicated through the statement that she plans to keep an active hand in running the company.

Austin will serve as the home base for the online dating firm, which also maintains offices in both London and New York.

Bumble's $14 billion valuation at its IPO, roughly five and a half years back, stands in contrast to where the company finds itself with this agreement. Launched in 2014, the platform built by Wolfe Herd — who had previously co-founded Tinder — operated on a design principle that gave women exclusive control over initiating contact.

Bumble, along with a number of rival dating platforms, has seen its user base contract as younger people grow increasingly disenchanted with app-based matchmaking. That August policy shift at Bumble — dropping the requirement for women to send the first message — formed part of a broader effort to draw more activity from its user base. During the same period, the firm rolled out an AI-driven tool built to guide users toward potential matches, giving them a route through the platform that bypasses the traditional profile-browsing format.

Trading in Bumble stock climbed by up to 57%, pushing the price to $5.98 on the New York exchange. By Monday's close, the stock had climbed 50% — a single-session advance not seen since the company's February 2021 market debut.

Gupta, who holds a partner position at Sequoia Capital, and Hegeman, who previously served as chief revenue officer at Meta Platforms Inc., together established Ithaca Holdings during the course of this year. A broadcast outlet's March report noted that the group's intention at that point was to bring at least one company — whether publicly listed or privately held — under its umbrella and modernise it through emerging technologies, AI among them.