Tegna confirmed Sunday that two suitors for the station group have just lately withdrawn acquisition affords, citing the upheaval within the broader market brought on by the coronavirus disaster.
Tegna’s assertion is the corporate’s first acknowledgement that it has acquired 4 unsolicited acquisition affords in current weeks. Two of these have since been withdrawn whereas the opposite two have but to progress within the due diligence course of, nor have the bidders suggested Tegna leaders on financing specifics, based on Tegna.
The suitors who’ve bowed out are believed to be Atlanta-based Grey Tv, which fielded a cash-and-stock supply valuing Tegna at $20 a share, or about $8.5 billion earlier this month. Non-public fairness big Apollo International Administration adopted with an all-cash supply in the identical vary. Tegna owns 62 network-affiliated TV stations serving 51 giant and mid-sized markets.
After the historic losses in U.S. equities markets over the previous three weeks, Tegna shares have fallen to $13.21 as of the shut of buying and selling on Friday. The inventory was within the $16-$17 vary on the time the wave of bids surfaced.
Along with Grey and Apollo, entrepreneur Byron Allen is alleged to have fielded an all-cash supply together with non secular broadcast group Trinity in partnership with Phoenix-based non-public fairness agency Najafi Firms. Najafi and Trinity on March 17 introduced that they had notified Tegna’s board of administrators of its intent to make an all-cash supply at $20 a share.
Tegna administration, led by president-CEO Dave Lougee, has been below strain from activist shareholder Soo Kim of funding agency Normal Normal to be extra energetic at a time of continued consolidation of native TV station property. Tegna is without doubt one of the final sizable collections of Huge four associates up for grabs as a pure-play broadcaster.
Sunday’s assertion marked Tegna’s first formal acknowledgement of acquisition exercise because the mating dances started final month.
“As has been extensively reported, Tegna has acquired 4 unsolicited acquisition proposals in current weeks,” Tegna stated in an announcement. “Tegna and its advisors engaged considerably with two of those events and supplied them intensive personal due diligence data. These two events made their proposals shortly earlier than the current market dislocation as a result of COVID-19 pandemic and each subsequently knowledgeable Tegna that they had been ceasing discussions. The opposite two events haven’t signed confidentiality agreements to allow due diligence and haven’t delivered any data on financing sources.”
Lougee stated in an announcement that the corporate’s rapid focus is on stabilizing enterprise amid the financial shock of the enterprise clampdown brought on by aggressive social distancing measures.
“Like each different firm, Tegna is working in uncharted waters on account of COVID-19 as we deal with guaranteeing the well being and security of our workers whereas persevering with to create and protect worth,” Lougee stated. “Excessive-quality native information has by no means been extra vital, and we’re lucky to have vital contractual subscription revenues and a powerful stability sheet with minimal near-term debt maturities. We’re working via the present challenges raised by COVID-19 and are very assured that our long-term development drivers stay intact.”
Normal Normal has proposed an alternate slate of 5 administrators to affix the Tegna board as a part of its effort to push the corporate to behave on the M&A entrance. Tegna administration has strongly refuted Normal Normal’s criticisms and pointed to Kim’s combined monitor report as an investor.
Tegna board chairman Howard Elias addressed the strain to think about options for the corporate — one thing that absolutely has been halted given the financial turmoil.
“Along with our deal with executing our standalone plan, the Tegna board and administration have meaningfully engaged with third events to discover alternatives to create worth,” Elias stated in an announcement. “The board has been, and stays, prepared to think about transactions that create compelling worth, and our focus now could be on serving to administration navigate via an unprecedented atmosphere.”