A new media merger may be in the works that threatens to pull the plug on another proposed media acquisition. The New York Times reports that Nexstar Broadcasting Group “made an unsolicited offer to buy Media General for $1.85 billion in cash and stock, potentially upending Media General’s recent bid for the Meredith Corporation.”
The pending Media General-Meredith merger was expected to create one of the country’s largest groups of broadcast network affiliates, with the combined group totaling 88 stations, as we reported earlier this month. That deal was valued at $2.4 billion.
“In a letter to Media General’s board of directors on Monday, Nexstar called the Meredith deal ‘ill-conceived’ and said a combination of Nexstar and Media General would create a much larger player in local television in the United States, with 162 stations in 99 markets reaching 39 percent of American households,” The Times reports. “Under the terms of the proposal, Nexstar would pay $14.50 a share in cash and stock worth, representing a 30 percent premium to Media General’s closing price on Sept. 25.”
In a letter to Media General’s board of directors, Nexstar Chairman Perry A. Sook wrote: “We strongly believe a combination of Media General and Nexstar is far more compelling strategically and financially than your planned acquisition of Meredith. Were you to engage with us, we believe you could deliver significantly more value to your shareholders.”
The proposed transaction values Media General at about $4.1 billion, including debt, The Times adds.