Meredith clears path for Nexstar’s acquisition of Media General


Details

Michelle Clancy

| 29 January 2016




Nexstar’s acquisition of local US TV affiliate powerhouse Media General is set to go forward for $4.6 billion.



The news comes as Meredith Corp withdrew its own merger transaction with Media General — a situation which had been blocking Nexstar’s pursuit.

Nexstar had originally offered $1.9 billion in an unsolicited acquisition proposal — a proposal that Media General rejected in favour of another option it had on the table: a $2.8 billion offer from Meredith. Media General played coy however, continuing negotiations with Nexstar for a better deal — which it got.

As compensation for exiting the situation, Meredith will receive a $60 million termination fee, and can negotiate to purchase some of the broadcast and digital assets now owned by Media General.

The Nexstar-Media General combination, to be called Nexstar Media Group, will have 171 full-power TV stations in 100 markets and reach 39% of US households.

"The acquisition of Media General's broadcasting and digital media assets represent a transformational growth opportunity for Nexstar and is strategically and financially compelling," said Perry Sook, CEO of Nexstar. "The transaction increases Nexstar's broadcast portfolio by approximately two-thirds, with very limited overlap with our existing properties, more than doubles our audience reach, provides entrée to 15 new top 50 DMAs and offers synergies related to the increased scale of the combined digital media operations."