In September, Nexstar Broadcasting Group gleefully played party crasher when it tried to scuttle Media General's $2.4 billion merger with Meredith Corp. by making an unsolicited $4.1 billion offer for the former. But today Nexstar lost a bit of swagger, announcing it has "reached an impasse" in its negotiations with the Richmond, Va.-based media company.
Media General's board of directors rejected Nexstar's revised proposal, valued at $16.31 per Media General share, up from its initial $14.50-per-share offer. Nexstar said the Media General board countered with an "unreasonable" $18.61 share price.
"The response from Media General is disappointing," said Nexstar chairman and CEO Perry Sook in a statement. "As a disciplined acquirer, we will only consummate a transaction that makes sense for both companies' shareholders."
Irving, Tex.-based Nexstar has built up a portfolio of more than 100 TV stations across the country. It made its unsolicited $4.1 billion offer in September, a few weeks after Media General announced a $2.4 billion merger with Meredith, which owns 16 TV stations but may be best known as a publisher of storied magazine titles including Better Homes and Gardens, Shape, Parents, Family Circle, and More.
Sook said his company's cash, stock and debt proposal "would be a transformational event for both Nexstar and Media General shareholders and would deliver superior, immediate and long-term value."
Nexstar hoped that Media General's shareholders would pressure the board to pick it over Meredith. And on Nov. 16, Media General said it would enter into negotiations with Nexstar.
Nexstar said a Media General acquisition would result in 162 stations in 99 markets, reaching 39 percent of American households. If the original deal goes through, Meredith Media General would be the third-largest owner of network affiliates, reaching approximately 30 percent of U.S. homes, with 88 stations in 54 markets.