Media General Rejects Nexstar Bid, Recommends Meredith Merger

10 Dec 2015 | Author: | No comments yet »

Media General Rejects Nexstar Bid, Recommends Meredith Merger.

Media General Inc. rejected a takeover offer by Nexstar Broadcasting Group Inc. of about $2.1 billion, saying it falls short and doesn’t take into account projections for future growth of the TV-station owner. Nexstar raised its bid by almost 17 percent to just under $17 a share in the last several days, a source said, adding that Media General has not yet responded to the latest offer or made it public.

The revised proposal values Media General, which operates TV stations in 48 U.S. markets, at $16.31 per share based on Nexstar’s closing share price on Dec. 8, Nexstar said in a statement Wednesday. But under pressure from activist investor Starboard Value, Media General’s board said last month it was open to a higher offer and would hold merger talks with Nexstar while still backing an existing agreement to buy Meredith Corp. That deal, under which Media General would pay about $2.4 billion in cash and stock for its smaller rival, was poorly received by Media General investors, who must approve it. Media General agreed last month to negotiate with Nexstar and brought in new advisers to run the talks, but the two sides have struggled to reach an agreement. They seek to get bigger to gain bargaining power with pay-TV providers and be able to charge higher retransmission fees for the right to carry their stations.

Nexstar, Media General and Meredith specialize in operating local affiliates of broadcast networks including 21st Century Fox Inc., CBS Corp., Comcast’s NBC and Walt Disney Co.’s ABC.

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