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Merger gives KHON-TV a new parent company

By Erika Engle

POSTED:
LAST UPDATED: 07:05 a.m. HST, Mar 21, 2014


Texas-based LIN TV Corp. and Virginia-based Media General Inc. have announced a $1.6 billion merger.

The combined company, to retain the Media General name and trade on the NYSE as MEG, will include 74 network-affiliated, owned or operated TV stations in 46 markets, serving nearly 23 percent of U.S. TV households, according to a statement.

LIN purchased KHON-TV in Honolulu and its neighbor island sister stations from New Vision Television in May of 2012. At that time, LIN officials said the transaction would give then 50 stations in 23 markets.

The Media General-LIN merger will give LIN shareholders $763 million in cash and 49.5 million shares in stock. LIN Media shareholders will own approximately 36 percent of the combined company, while Media General shareholders will retain about 64 percent of the new company.

The merger agreement allows LIN Media to entertain additional acquisition suitors through April 25 in a so-called "window shop" period, and any successful bidder that enters into an agreement with LIN prior to May 15 would pay Media General a termination fee of $26.6 million. A competing bidder that does not submit a superior acquisition bid prior to May 15 would pay a termination fee of $57.3 million.







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Wage Earner wrote:
LIN is killing KHON. They don't do real journalism, and should barely even be called a "news" station.
on March 21,2014 | 11:56AM
Hawaii5OhOh wrote:
Is that you, Bob Jones?
on March 21,2014 | 12:55PM
honupono wrote:
MARCH 21, 2014, 9:15 AM Comment Media General to Buy LIN Media, Creating Large TV Broadcaster By DAVID GELLES The Mass Communication Specialist 2nd Class Kyle P. Malloy/U.S. Navy The “Wake Up 2day” show on KHON in Honolulu, a station owned by LIN Media. Media General said on Friday that it would acquire LIN Media for $1.6 billion in a cash and stock deal that will create the second-largest local television broadcasting company. LIN Media shareholders will receive about $27.82 a share, about a 28 percent premium. Both Media General and LIN Media operate local television stations that act as affiliates to the big broadcast networks like ABC, CBS and NBC. The combined company will own 74 stations in 46 markets and reach 26.5 million households, or 23 percent of the market in the United States. It will rank behind only Sinclair Broadcast Group in terms of number of stations operated. Media General shares were up 12 percent in premarket trading. This is the first local broadcasting deal announced since Comcast agreed to acquire Time Warner Cable, creating the largest cable operator in the country. If completed, that deal could put pressure on local television groups like Media General and LIN, which are paid by cable operators for the right to carry their local stations. Analysts predicted that local networks group like Media General and LIN Media might consolidate to have more leverage at the bargaining table. The chief executive of LIN Media, Vincent L. Sadusky, will lead the combined group, which will be called Media General. “The merger of two highly respected broadcasters with superior television and digital assets creates maximum value for shareholders and provides us the scale, breadth and resources to compete more effectively in the rapidly evolving media landscape,” Mr. Sadusky said. “Together, we will be able to better serve our local communities throughout our significant and diverse geographic footprint and further grow our national digital business.” The merger agreement includes a one month go-shop period, during which LIN Media can open its books to other interested parties. If a new buyer emerges during that time, it would only have to pay a 1.625 percent break fee, or $26.6 million, if it makes a bid by May 15. If a buyer emerges after May 15, the break fee would double. RBC advised Media General, and Fried, Frank, Harris, Shriver & Jacobson provided it with legal advice. JPMorgan advised LIN, and Weil, Gotshal & Manges provided LIN with legal advice.
on March 21,2014 | 02:54PM
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