Gannett media buys Journal Media Group for $280 million

Gannett said it will finance the deal through cash and borrowing under its $500 million revolving line of credit

Newspaper giant Gannett, publisher of USA Today, said in a statement that it was buying the Journal Media Group for $280 million.

The Milwaukee, Wisconsin-based Journal Media Group owns 17 small- and medium-sized newspapers in nine US states, including the Milwaukee Journal-Sentinel and the Commercial Appeal, which is based in Memphis, Tennessee.

It also owns 18 weekly publications.

The deal was approved by the board of directors of both companies, but awaits final approval from the shareholders of the Journal Media Group, who will receive $12 (10.63 euros) a share in cash -- a 44.6% premium over its Wednesday closing price of $8.30, Gannett said.

Gannett, based just outside the US capital in McLean, Virginia, said it will finance the deal through cash and borrowing under its $500 million revolving line of credit.

The purchase increases Gannett's annual revenues by $450 million and its daily circulation by 675,000, the company said.

With this purchase, Gannett said it will have a media outlet in 106 local markets in the United States, resulting in "a combined digital audience of more than 100 million unique visitors a month."

The Journal Media Group was formed last year following the merger of the EW Scripps company and Journal Communications.