Tegna said it has agreed to be acquired by Standard General in a deal worth $8.6 billion, including the assumption of $3.2 billion in debt.
Tegna shareholders will get $24 for the shares and Apollo Global's Cox Media Group will acquires Tegna stations in Dallas, Houston and Austin.
Apollo will own securities in the new privately held company. Those securities will be non-voting and not attributable.
Standard General, led by investor Soo Kim, has been pursuing Tegna for two years, criticizing the company's management. It lost a proxy fight aimed at gaining seats on Tegna’s board last year. Byron Allen's Allen Media Group also was reportedly bidding for Tegna.
Tegna owns 64 television stations in 51 U.S. markets. It also owns multicast networks True Crime Network, Twist and Quest and advanced-advertising company Premion.
Earlier: Tegna Has Received Offers To Buy Company
“As long-term investors in the television broadcasting industry, we have a deep admiration for Tegna and the stations it operates and, in particular, for Tegna’s talented employees and their commitment to serving their communities,” said Kim, founding partner of Standard General.
When the transaction closes veteran broadcaster Deb McDermott will become CEO and Kim will serve as chairman of a new board of directors. McDermott, who has been head of Young Broadcasting and Media General, is current CEO of Standard Media.
Following the close of the transaction, Tegna stations in Austin (KVUE), Dallas (WFAA and KMPX) and Houston (KHOU and KTBU) are expected to be acquired by Cox Media Group. Also after closing, Premion is expected to operate as a standalone business majority owned by CMG and Standard General.
“We are excited to partner again with Deb McDermott, who previously spearheaded the broadcast group at Media General, where Standard General was a principal shareholder,” Kim said. "We believe Tegna has a strong foundation and exciting prospects for continued growth as a result of the stewardship of the Board and the current management team. We look forward to building on the Company’s strong foundation and leveraging Deb’s deep industry experience to drive further growth.”
McDermott will be replacing Tegna CEO Dave Lougee.
“I am honored to lead Tegna team to create new opportunities and build on its heritage and successes achieved under Dave’s leadership," McDermott said. "Tegna's stations have earned excellent reputations as leading local content providers, and Tegna's digital and content assets are a key part of its future in an evolving media landscape. These achievements are a credit to the hard work of Tegna's dedicated employees, who are the company’s most valuable asset. I’m very excited about what the future holds for Tegna.”
Lougee called the transaction the next step in Tegna's evolution.
"Tegna's employees deserve tremendous credit for their commitment to serving our viewers with high-quality news and content that informs and supports our local communities," Lougee said. "At all levels, we have been tireless in our efforts to ensure Tegna effectively serves all of our stakeholders, and I am immensely proud of these efforts. Our hard work has built a company that is a leading and trusted local news and media content provider in the markets it serves and has fostered a culture of diversity and inclusiveness. We are deeply gratified that Tegna's new owners value and embrace our purpose to serve the greater good of our communities. Deb McDermott is an experienced and accomplished broadcast executive, and we are confident in Tegna's future under her leadership.”
The deal is contingent on securing the requisite regulatory approvals from the FCC and Justice Department. The FCC must sign off on any transfer of broadcast licenses to insure the deal is in the public interest, while Justice reviews deals over a certain price threshold to insure the deal is not anti-competitive. ■
