Gannett will now cover 106 local markets. ised to be an acquirer in an industry ripe for consolidation.
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The added income, though is negligible, $60 million EBITDA. The new company was in the black, but barely.
Journal Media shareholders will receive $12 a share in cash.
Gannett, based in McLean, Va., will finance the deal through cash and borrowing under the company’s $500 million revolving credit line.
“Our merger will combine the best of each of our organizations to create a journalism-led, investor-focused company which will provide substantial value to the shareholders of both companies”, Dickey said.
Story updated at 7:47 p.m.to confirm Gannett’s purchase of Journal Media Group.
“This acquisition is a flawless fit for Gannett”, said John Maher, president and publisher of RGJ Media.
Gannett and Journal Media were not immediately available for comment.
Adds approximately $450 million to Gannett’s annual revenues. The Business Journal reported that Gannett Publishing Services posted $29.22 million metro-area sales the previous year, when it was ranked the largest printer by revenue. The merger will give Gannett ownership of six daily newspapers in Tennessee, including the state’s three biggest papers, and extend its Midsouth footprint from Arkansas through Kentucky and Tennessee to western North Carolina. Their print circulation will also increase by about 950,000 Sundays and 675,000 weekdays.
Gannett is focusing on USA TODAY and local markets, 10 of which are in Wisconsin.
Journal Media Group was established just this spring in a merger/spinoff between E.W. Scripps (NYSE:SSP) and Journal Communications; JMG took on the newspaper operations of both companies while handing off broadcast and digital media to Scripps.
By acquiring Journal Media Group, Gannett follows through on an earlier assurance to shareholders that it would adopt an acquisitive strategy following the spinoff from its parent company in June.
The receipt of cash for shares of Journal Media Group will be a taxable transaction for USA federal income tax purposes.
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This transaction is subject to customary closing conditions, including, approval of the merger by holders of a majority of the outstanding shares of Journal Media Group common stock and antitrust regulatory clearance.
