Media General Inc. announced Tuesday that it will be merging with Meredith Corporation in a cash and stock deal valued at $2.4 billion, creating Meredith Media General.
Media General operates 71 television stations across 48 markets and boasts the “largest and most diverse digital media business with a growing portfolio,” according to the company’s website. Meredith is a multiplatform company that distributes content through broadcast television, print, digital, mobile, and video. Uniting the two companies will provide them with a much broader reach; Meredith Media General will be the nation’s third-largest owner of local television stations in the U.S.
The deal has been approved by the boards of directors at both Media General and Meredith, but awaits approval by shareholders and the Federal Communications Commission. The transaction is expected to close by June 30, 2016.
The CEO and CFO of the newly fused company will be Stephen M. Lacy and Joseph H. Ceryanec, who currently hold those respective positions at Meredith. The company expects over $80 million in synergies in its first two years after the transaction closes. It also predicts $3 billion in annual revenues and over $900 million in EBITDA.
J. Stewart Bryan III, Media General chairman, commented on the deal:
This merger creates greater opportunities for profitable growth than either company could achieve on its own. Importantly, shareholders of both companies will benefit from the upside potential of a diversified and strategically well-positioned media company with a strong financial profile and the ability to generate significant free cash flow.