Local TV stations under new management group

Staff report

YOUNGSTOWN

Nexstar Broadcasting Group has reached a deal to acquire Media General, whose portfolio of television stations includes Youngstown’s WKBN and WYFX.

According to tvnewscheck.com, which covers the broadcasting business, the terms of Nexstar’s acquisition call for $10.55 per share in cash and 0.1249 of a share of Nexstar Class A common stock for each Media General share. That’s $17.66 per share based on Thursday’s close price of Nexstar shares.

Nexstar said it is looking forward to signing a definitive agreement with Media General as soon as Media General’s proposed merger with Meredith Corp. is terminated by either party or after a Media General shareholder vote in which the transaction is not approved.

The demise of the Media General-Meredith merger, announced last September, however, may never come, according to tvnewscheck.com.

Shortly after Nexstar announced its agreement with Media General, Meredith countered with a new deal that sweetens its offer in the eyes of Media General shareholders.

WKBN, which is a CBS affiliate for the Mahoning Valley, and WYFX, a Fox affiliate, currently have a shared-news production agreement and a joint sales staff agreement with WYTV and MyYTV, which are owned by Vaughan Media. All four stations share a building on the South Side of Youngstown.

If the Nexstar-Media General merger is finalized, it is unclear what, if any, changes would occur at WKBN and WYFX. Dave Coy, general manager of the four stations, could not be reached to comment Thursday.

“We are pleased to have negotiated these transaction terms with Media General as we believe the combination would be a transformational event that enables both companies’ shareholders to participate in the near- and long-term upside of a pure-play broadcasting company with expanded audience reach, a more diversified portfolio and a significantly stronger financial profile, led by a proven broadcast and digital media management team,” said Perry Sook, chairman, president-CEO of Nexstar, in a news release.

“We are confident that a combined Nexstar-Media General would be strongly positioned for long-term success in a dynamic and consolidating broadcast market,” Sook added. “Specifically, the combined company would be highly attractive to programmers and advertisers alike, while the anticipated year-one synergies of $76 million and generation of over $500 million of annual free cash flow will enhance long-term shareholder returns.”

Nexstar also noted it intends to divest the TV stations necessary to obtain FCC regulatory approval of the proposed transaction. In addition, two Media General directors would join the Nexstar board of directors at closing.

The negotiated transaction would not be subject to any financing condition. Nexstar has worked with banks willing to provide commitment letters for approximately $4.7 billion in financing in support of the transaction as soon as the negotiated merger agreement is executed.