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Nexstar to buy Tribune Media for $4.1 billion


By and Sonam Rai

(Reuters) - Inc said on Monday it agreed to buy Chicago-based peer Company for about $4.1 billion in cash, making it the largest regional U.S. TV

Nexstar said it would pay $46.50 per share, representing a premium of 15.5 percent to Tribune Media's closing price on Friday. Tribune shares rose 10 percent and Nexstar shares 3 percent in midday trading.

The value of the deal was in line with what reported on Sunday, citing people familiar with the matter.

Including debt, the deal is worth $6.4 billion.

The acquisition comes just three months after Sinclair Broadcast Group Inc's $3.9 billion deal to buy Tribune collapsed over regulatory hurdles.

However, since then the has seen a flurry of merger talks, amid expectations that the (FCC) could relax restrictions on how many stations broadcasters can operate.

Irving, Texas-based Nexstar said the transaction was subject to approvals by Tribune's shareholders and regulators including the FCC. The company intends to divest certain television stations necessary to comply with regulatory ownership limits.

Nexstar owns, operates and provides to 174 television stations reaching nearly 39 percent of all U.S. television households, while owns or operates 42 local television stations reaching approximately 50 million households.

Nexstar outbid private equity firm with an all-cash offer that values Tribune at around $46.50 per share, three sources had told

The deal, expected to close late in the third quarter of 2019, will add about $160 million in the first year to Nexstar's earnings, the companies said.

"The transaction will result in approximately 46 percent growth in Nexstar's average annual free cash flow in the 2018-2019 cycle to approximately $900 million," Nexstar's said in a statement.

Nexstar said it had received committed financing for the transaction from BofA Merrill Lynch, and

"We think this is a great acquisition for Nexstar that would position them to be the in the space...the transaction is massively FCF accretive and the synergy numbers are likely to prove conservative," said

BofA Merrill Lynch is serving as the and and as to Nexstar.

and are financial advisers to and and are its

(Reporting by and in Bengaluru; Editing by and Shailesh Kuber)

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

First Published: Mon, December 03 2018. 22:19 IST