Sinclair Broadcast Group, Inc. (NASDAQ: SBGI) announced to buy Tribune Media Company (NYSE: TRCO) in a $3.9 billion deal.
Under the deal, Sinclair will buy 100 percent Tribune’s shares at $43.5 per share, representing a nearly 8 percent premium to Tribune’s closing price on Friday. Sinclair will also assume approximately $2,7 billion in net debt. Tribune shareholders will receive $35 in cash and 0.23 shares of Sinclair Class A common stock for each share of Tribune Class A common stock and Class B common stock.
"This is a transformational acquisition for Sinclair that will open up a myriad of opportunities for the company," Sinclair CEO Chris Ripley said in a statement. "The Tribune stations are highly complementary to Sinclair's existing footprint and will create a leading nationwide media platform that includes our country's largest markets."
The deal will help Sinclair better compete with Fox. Tribune owned and operates 42 broadcast stations. It also operates cable network WGN America, Tribune Studios and WGN-Radio. The deal was first reported by Reuters on Sunday.
Tribune shares rose 5.14 percent to $42.35 in the early trading, while Sinclair pared its early gain and was trading 2.5 percent lower.
“Today’s announcement is the culmination of an extensive strategic review, which has delivered significant value to our stockholders,” said Tribune CEO Peter Kern.