ATLANTA—As expected, Gray Television, Inc. has closed its acquisition of Meredith Corporation’s Local Media Group and its 17 television stations in 12 local markets for $2.8 billion.
The completion of the deal means that Gray’s television stations now serve 113 local markets reaching approximately 36 percent of US television households.
With estimated combined historical basis net revenue exceeding $3.2 billion on a blended 2020/2021 basis, Gray is now the nation’s second largest television broadcaster in terms of revenues, the company said.
The new larger portfolio includes 79 markets with the top-rated television station and 101 markets with the first and/or second highest rated television station, making Gray the largest owner of top-rated local television stations and digital assets in the United States, the company said.
“Gray is a far stronger company today with the exciting and transformative addition of Meredith’s excellent television stations and its fine employees,” said Gray’s executive chairman and CEO Hilton H. Howell. “We are grateful to the numerous professionals at Gray, Meredith and their advisers who dedicated themselves over the past year to the successful completion of this transaction.”
Gray’s acquisitions of Quincy Media, Inc. in August and of Meredith today are anticipated to be approximately 50 percent accretive to blended 2021/22 free cash flow per share, the company said.
The Meredith acquisition will increase Gray’s net revenues and expenses in the fourth quarter 2021. As a result the company provided the following updated guidance to investors:
- Broadcasting net revenues of between $655 and $665 million, and
- Operating expenses [before depreciation, amortization, and (gain) loss on disposal of assets, net] for broadcasting of between $457 and $466 million including transaction related expenses of between $19 and $20 million, and corporate expenses of between $73 and $80 million including transaction related expenses of between $51 and $54 million.
