That is a 45% premium from the Wednesday closing price of $8.30.
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The newspapers that came from Scripps included the Memphis Commercial Appeal, the Knoxville News Sentinel and the Naples (Fla.) Daily News. It was approved by both companies’ boards of directors and is subject to approval by Journal Media Group shareholders.
Gannett, based just outside the United States capital in McLean, Virginia, said it will finance the deal through cash and borrowing under its $500 million revolving line of credit.
“Gannett is excited to be joining forces with an organization that is so respected by their communities and industry”, Gannett Chief Executive Robert Dickey said.
“This transaction will allow us to focus on creating quality journalism for our communities while building substantial value for our shareholders”, he said. The Journal Sentinel says all of its news-related decisions will remain in Milwaukee.
Gannett’s flagship publication is USA Today. Their print circulation will also increase by about 950,000 Sundays and 675,000 weekdays.
Leverages Gannett’s existing industry-leading content and national USA TODAY brand, enables the integration of Journal Media Group properties onto Gannett’s Digital Platform, and delivers additional scale for National-to-local strategy. Journal Media Group’s price tag is also on the high end of the $250 million Gannett said it planned to spend on acquisitions annually. The deal is expected to add about $450 million to annual revenues and about $60 million in earnings before interest, taxes, depreciation and amortization.
In a statement tonight, Gannett estimates that the merger should save the combined company $25 million over the next two years from “consolidation of corporate and administrative operations, integration with the Gannett shared service centers and consolidation of certain printing and distribution assets in multiple adjacent markets”.
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In summer, Gannett became a company, running newspapers exclusively, and has moved all its TV companies into a different company, Tegna Inc.
