Warren Buffett Saved Media General: Don’t Dismiss Berkshire In A Fight Over …

29 Sep 2015 | Author: | No comments yet »

Hostile bid makes best TV in U.S. broadcast fight.

IRVING (AP) – Nexstar Broadcasting is trying to wedge between Media General and Meredith Corp. with a nearly $1.9 billion offer to buy Media General.RICHMOND, Va., Sep 28, 2015 (BUSINESS WIRE) — Media General, Inc. (NYSE: MEG; www.mediageneral.com) (“Media General” or the “Company”) todayconfirmed that it has received an unsolicited proposal from Nexstar Broadcasting Group, Inc.Nexstar Broadcasting has made a bid for TV-station owner Media General, in a surprise maneuver aimed at breaking up Media General’s effort to acquire Meredith Corp.

NXST, -2.27% to acquire all of the outstanding common stock of Media General for $14.50 per share in cash and stock, including $10.50 per share in cash and a fixed ratio of 0.0898 Nexstar shares per Media General share. Consistent with its fiduciary duties, the Media General Board of Directors, in consultation with its legal and financial advisors, will carefully review and consider the proposal to determine the course of action that it believes is in the best interests of the Company and its shareholders. This communication is for informational purposes only and is neither an offer to purchase, nor a solicitation of an offer to sell, any securities or the solicitation of any vote in any jurisdiction pursuant to the proposed transactions or otherwise, nor shall there be any sale, issuance or transfer of securities in any jurisdiction in contravention of applicable law. Many of the companies are jettisoning newspapers in order to focus more strongly on broadcast stations, which are thought to have strong ties to local markets while able to enjoy revenues from distribution via cable and broadband. Getting back into the persistently declining print business would be a retrograde step for Media General, which previously offloaded its newspapers to focus on broadcasting.

No offer of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act of 1933, as amended. And Nexstar is calling for potential cost cuts of $75 million a year, while also arguing that its preferred deal would involve less chunky divestments. TV station operators have increasingly become preoccupied with size, convinced that having more stations in their portfolio would render greater bargaining leverage in distribution and retransmission contract negotiations with cable and satellite companies. “We agree and believe that a combination of Nexstar and Media General would create a combined entity with enhanced scale and geographic diversity to compete effectively in a consolidating and dynamic market,” Sook wrote. “Together, Nexstar/Media General would be the #2 owner of major network affiliates.” Nexstar also warned that an acquisition of Meredith — which owns several national magazines, including Better Homes and Gardens, Parents and Shape — would expose Media General shareholders to the publishing industry’s volatility and anticipated decline. Media General sold a large part of its newspaper holdings to Warren Buffett’s Berkshire Hathaway in 2012 and last year announced a deal to buy broadcaster LIN Media for $1.6 billion.

After the acquisition, more than half of Meredith and Media General’s earnings before interest, taxes and other items would come from publishing as the combined company would divest some TV assets, Nexstar said. Information about Media General’s directors and executive officers is available in Media General’s definitive proxy statement, dated March 13, 2015, for its 2015 annual meeting of shareholders. Other information regarding the participants and description of their direct and indirect interests, by security holdings or otherwise, will be contained in the Form S-4 and the joint proxy statement/prospectus regarding the Merger that Meredith Media General will file with the SEC when it becomes available. You can generally identify forward-looking statements by the use of forward-looking terminology such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “explore,” “evaluate,” “intend,” “may,” “might,” “plan,” “potential,” “predict,” “project,” “seek,” “should,” or “will,” or the negative thereof or other variations thereon or comparable terminology.

These forward-looking statements are only predictions and involve known and unknown risks and uncertainties, many of which are beyond Media General, Meredith and Meredith Media General’s control. No assurances can be given that any of the events anticipated by the forward-looking statements will transpire or occur Media General assumes no duty to update or revise forward-looking statements, whether as a result of new information, future events or otherwise, as of any future date.

Media General is one of the nation’s largest connected-screen media companies that operates or services 71 television stations in 48 markets, along with the industry’s leading digital media business.

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