Meredith Corporation says it will pay shareholders more to buy Media General after Nexstar’s announcement this morning that the two had completed negotiations.
Meredith’s deal has been amended to include paying shareholders more than $20 a share in near-term value. The offer includes a $3.90 per share in cash offer at closing, a pro-forma equity share value of $14.94 and a contingent value right (CVR) representing after-tax net cash proceeds from the sale of Media General’s spectrum in the FCC’s upcoming spectrum auction. Meredith also says it will pay a annual dividend starting at $0.68 a share.
“We’re confident that the combination of Meredith and Media General will generate superior value over both the near- and long-term, particularly when compared to the unsolicited offer Nexstar Broadcasting Group has made for Media General,” said Meredith Chairman and CEO Stephen M. Lacy. “Given the compelling and superior value inherent in this proposal, we ask that the Media General Board of Directors re-enter serious negotiations around the Merger of Equals structure and its merits.”
Calling its deal with Media General a “Merger of Equals,” Meredith added it believes Nexstar and Media General won’t be able to enter into an agreement and file the application in time for the spectrum auction, which will result in “significantly delaying any financial benefit to Media General shareholders, and exposing the transaction to potential market and industry risks.”