Media General rejects Irving-based Nexstar bid, agrees to negotiationsBy Paul

Media General had planned to acquire broadcast and print media giant Meredith in a deal valued at $2.4 billion, but Nexstar, one of the largest independent broadcasters in the country, lobbed in an offer for Media General valued at $4.1 billion. Later in the month, Irving, Texas-based Nexstar made an unsolicited $1.85 billion takeover bid for Media General. That pact “allows the Company to explore a potential transaction and negotiate with a third party making an acquisition proposal”, Media General says this morning.

A Media General-Meredith deal would create a new company that combines Media General’s catalog of local TV stations with Meredith’s magazine content. A Nexstar acquisition of Media General would create a broadcasting company with 162 stations that would reach 39 percent of USA households.

“It is important to remember that our binding agreement to merge with Media General remains in place with fully-committed financing of $2.8 billion; we are making significant progress on achieving key regulatory approvals needed to complete the transaction; our joint integration work has already identified additional synergies; and the Meredith and Media General Boards of Directors continue to recommend the Meredith-Media General transaction”.

Activist investor Starboard Value LP had urged Media General to take the Nexstar offer and drop its pursuit of Meredith.

Nexstar owns, operates, programs or provides services to more than 100 television stations in 58 markets.

Media General climbed 0.6 percent to $15.55 at 9:44 a.m.in NY. Media General, which eventually retained additional financial and legal advisors to assist its board of directors in examining it, revealed on October 14 that it had reached an agreement with Meredith permitting the mutual exchange of specific non-public information with Nexstar.

Meredith is known for magazines such as Better Homes & Gardens and Family Circle.

“The proposal substantially discounts Media General’s standalone growth prospects”, the company said. “We believe our proposal will deliver superior, immediate and long-term value to Media General shareholders compared with any alternatives available to the company”.

Consistent with the terms of the Meredith Agreement, Media General has provided written notice to Meredith of the board’s determination.