Nexstar Media To Buy Tribune Media For $6.4 Bln, Incl. Debt

(RTTNews) - Nexstar Media Group, Inc. (NXST) said that it agreed to acquire all outstanding shares of Tribune Media Co. (TRCO) for $46.50 per share in a cash transaction that is valued at $6.4 billion including the assumption of Tribune Media's outstanding debt. The transaction reflects a 15.5% premium for Tribune Media shareholders based on its closing price on November 30, 2018.

Tribune Media shareholders will be entitled to additional cash consideration of approximately $0.30 per month if the transaction has not closed by August 31, 2019.

The transaction has been approved by the boards of directors of both companies and is expected to close late in the third quarter of 2019, subject to receipt of required regulatory approvals and satisfaction of other customary closing conditions.

Upon closing, the transaction is expected to be immediately accretive to Nexstar's operating results inclusive of expected operating synergies of approximately $160 million in the first year following the completion of the transaction and planned divestitures.

Following the completion of the transaction, Nexstar will benefit from increased operational and geographic diversity and scale as a result of Tribune Media's diverse portfolio of media assets including 42 owned or operated broadcast television stations in major U.S. markets; compelling local news and entertainment content creation; significant broadcast distribution; a reinvigorated general entertainment cable network, WGN America; a 31% ownership stake in TV Food Network, which is a top tier cable asset; and equity investments in several digital media businesses, Nexstar Media said.

Perry Sook, Chairman, President and CEO of Nexstar, said, "Financially, the transaction will result in approximately 46% growth in Nexstar's average annual free cash flow in the 2018/2019 cycle to approximately $900 million, or approximately $19.50 per share, per year based on approximately 46.2 million Nexstar shares outstanding."

Completion of the transaction is subject to approval by Tribune's shareholders, as well as customary closing conditions, including approval by the FCC, and satisfaction of antitrust conditions. Nexstar intends to divest certain television stations necessary to comply with regulatory ownership limits and may also divest other assets which it deems to be non-core. All after-tax proceeds from such asset sales are expected to be applied to leverage reduction.