Just weeks after it agreed to pay $2.4 billion to acquire rival Meredith, Media General is now itself the target of a hostile takeover bid, with Nexstar Broadcasting Group bidding $4.1 billion for the station group.
The new deal would terminate the agreement between Media General and Meredith. Instead, Nexstar's 91 TV stations would be combined with Media General's 71 stations in 48 markets, forming the third largest station group.
"Given the compelling strategic and financial value of a combination, it is illogical that Media General's board has refused to engage with us and has instead pursued an ill-conceived and value-destructive acquisition of Meredith that would once again expose Media General shareholders to the risks of the low-margin publishing business," Nexstar CEO Perry Sook said in a statement.
"We believe our offer is compelling and provides a value-building path forward for both Media General and Nexstar shareholders," he added.
Nexstar presented an offer to Media General's board Friday that delivered a 30 percent premium of the company's closing stock price that day.
Nexstar's move also comes after Gray Television agreed to pay $442.5 million to acquire Schurz Communications. The wave of broadcast consolidation comes as station owners are seeking greater scale and heft to offset mergers and consolidation in the pay-TV market.
According to data released last week by SNL Kagan, the average amount paid per pay-TV subscriber for broadcast retransmission has increased 40 percent just in the last year. Broadcast stations are, of course, looking to sustain these quickening fee increases.
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