Media General, the parent company of WTNH, confirmed that it has reached a sale price agreement to sell itself to Nexstar Broadcasting Group, but an industry expert says the deal is thick with complications.
Rich Hanley, associate professor of journalism in the School of Communications at Quinnipiac University, said Nexstar can’t complete the deal until Media General legally terminates its agreement to buy Meredith even though that agreement collapsed last year.
Hanley said the Media General/Meredith deal is off the table but not formally terminated in a legal sense. That, however, shouldn’t squash Media General’s deal with Nexstar. According to documents filed with the SEC, Nexstar can’t acquire Media General until Meredith formally terminates the merger agreement with Media General or Media General shareholders vote on termination.
“That hasn’t happened yet even though all agree that the deal for Media General to buy Meredith is not going to happen. If Meredith persists in its failure to formally terminate the agreement, Media General shareholders will have to vote to do so. That stretches the process out for a few weeks,” said Hanley.
Further complicating the issue, according to Hanley, is that the Federal Communications Commission must approve the deal.
The negotiated transaction reflects a value of $17.66 per share plus the value of the contingent value right.
