Meredith Promises ‘Superior’ Deal to Nexstar’s Offer

By Kevin Eck 

Meredith says it won’t sit idly by and watch Nexstar woo Media General away from what it’s calling a “binding” merger between the two station groups.

Meredith released a statement this morning, in response to Media General’s announcement that it was officially talking to Nexstar about its unsolicited offer to buy Media General for $4.1 billion.

Meredith reminded Media General that their announced merger is a better deal for shareholders over the long run. Meredith also says it “understands Media General Board’s fiduciary responsibility to respond to the Nexstar proposal consistent with our binding merger agreement announced on September 8, 2015,” but added it has the right to offer an “alternative superior proposal” to whatever Nexstar may offer.

Advertisement

“Meredith’s Board of Directors still unanimously agrees that the merger agreement reached with Media General as currently structured is in the best interests of shareholders,” said Meredith chairman and CEO Stephen M. Lacy. “Enhancing Meredith shareholder value will remain our top priority as we move forward in this merger process.”

Meredith also listed all the good things a merger with Media General would bring:

The new Meredith Media General will be a diversified, multiplatform media company with a strong financial position, unmatched content creation capabilities, deep consumer insights and data, and expansive reach. Its compelling attributes include:
A powerful competitor in the media industry with $3 billion in revenues, over $920 million of EBITDA, and at least $1 billion in pro-forma cumulative free cash flow in the first two calendar years post-closing.
At least $85 million of verified synergies, which could climb even higher as the two companies move forward with integration activities.
More than 80 television stations across 54 markets that reach 34 million U.S. TV households. These high-quality local broadcast assets will include 25 Big Four network-affiliated TV stations in the Top 50 DMAs, making Meredith Media General the largest owner of Big Four stations in Top 50 markets.
A powerful digital platform reaching more than 200 million monthly unique visitors via a combination of leading national and local consumer sites and business-to-business digital capabilities in key growth sectors such as content, mobile, social, video and native advertising.
Leading multiplatform national media brands with a top female reach of 100 million unduplicated American women and over 60 percent of U.S. Millennial women across multiple platforms including print, digital, mobile, video and brand licensing. It will also possess a profitable marketing services business.
The new Meredith Media General will also be positioned for long-term growth in the media industry:
Meredith Media General’s 30 percent TV household reach provides for further expansion in the television space, as it is well below the government-mandated 39 percent ownership cap.
Meredith Media General will possess a powerful digital business, with projected first-year revenues of approximately $500 million and tremendous growth potential. Meredith has an established and profitable digital business and is well-positioned to maximize opportunities inherent in Media General’s current digital activities.
Meredith Media General will build on Meredith’s success in generating revenues not dependent on advertising via its high-margin brand licensing and its nationally recognized and profitable marketing services businesses.

Advertisement