Scripps and Journal Communications have agreed to merge their station groups and spin off and then merge their newspapers, creating two separate public companies. The broadcast outfit will retain the E.W. Scripps name and remain in Cincinnati. It is expected to have annual revenue of more than $800 million.
The merged newspaper company will be called Journal Media Group and will be headquartered in Milwaukee.
The Scripps and Journal boards of directors have approved the stock-for-stock transactions. Subject to regulatory approval, the deal is expected to close in 2015.
"In one motion, we're creating an industry-leading local television company and a financially flexible newspaper company with the capacity and vision to help lead the evolution of their respective industries," said Rich Boehne, chairman, president and CEO of The E.W. Scripps Company, who will continue to run Scripps. "Making the combinations even more appealing are the rich histories of these two organizations, both driven by a deep commitment to public service through enterprise journalism. For shareholders, this deal should unlock significant value as both companies gain efficiency, scale and more focus on the industry dynamics unique to these businesses."
"This transaction will create two solid media businesses that will continue to serve their communities with a commitment to integrity and excellence that has been built over many years," said Steven J. Smith, chairman and CEO of Journal Communications. "Journal's radio and television stations will add depth and breadth to the Scripps TV group and additional expertise to its management team. The formation of the new Journal Media Group will continue a tradition of exceptional print and digital journalism in 14 markets across the country. These companies will offer a combination of excellent local media assets and an incredible array of talent in our employees."
Journal shareholders will own approximately 31% of The E.W. Scripps total shares following the merger, while Scripps shareholders will retain approximately 69% ownership.
The companies project about $35 million in combined transaction synergies in the near term.
Tim Stautberg, senior VP, newspapers for Scripps, will become president, CEO and a director of Journal Media Group upon completion of the transaction. Smith will become non-executive chairman of the board.
