Sinclair, one of the largest TV station group owners in the United States, has made a bold move by proposing to acquire E.W. Scripps Co., a smaller rival, in its entirety. The offer stands at $7 per share for the stock in Scripps that Sinclair does not already own. This acquisition bid was disclosed in an SEC filing on Monday, where Sinclair also revealed that it has already acquired a 9.9% stake in Scripps. Just last week, Sinclair had announced the acquisition of 8.2% of Scripps’ common shares and initiated talks regarding the acquisition.
Sinclair currently operates and provides services to 185 TV stations in 85 markets, while Scripps has a presence in more than 60 stations across 40-plus markets. If the Scripps acquisition goes through, Sinclair estimates that Scripps shareholders would own approximately 12.7% of the combined entity.
This proposal from Sinclair comes at a time when Nexstar Media Group, the largest TV station ownership group in the US with 201 stations, is in the process of finalizing its $6.2 billion deal to acquire Tegna, which owns 64 stations. Nexstar recently filed applications seeking a waiver from the FCC regarding the agency’s 39% ownership cap on TV station owners’ reach across US households.
In response to Sinclair’s takeover offer, Scripps issued a statement acknowledging the proposal. The company stated that its board of directors will carefully review and evaluate all proposals, including the unsolicited bid from Sinclair, to determine the best course of action for the company, its shareholders, employees, and the communities it serves.
According to Sinclair’s proposal, Scripps shareholders would receive $7.00 per share, comprising $2.72 in cash and $4.28 in combined company common stock, based on an estimated $325 million in synergies. The $7-per-share price represents a significant 200% premium to Scripps’ 30-day volume-weighted average price as of November 6.
Under the terms of the Sinclair proposal, Scripps shareholders have the option to choose between an all-cash or all-stock consideration for their shares, subject to proration based on the maximum cash and equity amounts specified in the offer.
This potential acquisition between Sinclair and Scripps signifies a significant development in the media industry, with major players making strategic moves to strengthen their market positions and reach. As the situation unfolds, all eyes will be on how Scripps responds to Sinclair’s offer and the potential impact this acquisition could have on the broader media landscape.
