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Gray Television to acquire Raycom Media for $3.65B.

Gray Television and Raycom Media announced that they have entered into an agreement to combine their companies in a transaction that will create the single largest owner of top-rated local television stations and digital assets in the country. This transaction marks Gray's transformation from a small, regional broadcaster into a leading media company with nationwide scale based on high-quality stations with exceptional talent in attractive markets. Gray and Raycom have highly complementary portfolios of television stations as well as highly complementary company cultures, award-winning journalistic commitments, and long histories of commitments to exceptional community service. Gray in particular is delighted to announce that, upon the closing, Raycom President and CEO, Pat LaPlatney, will become Gray's President and Co-Chief Executive Officer. The transaction is subject to customary closing conditions and regulatory approvals. The parties expect to close the transaction in the fourth quarter of 2018. Gray expects that the Raycom transaction will be substantially accretive on a free cash flow per share basis. Under the terms of the merger agreement between the parties, Gray will acquire Raycom for $3.647B in total proceeds, consisting of $3.547B in enterprise value and $100M of Raycom cash. The consideration will consist of $2.85B in cash, $650M in a new series of preferred stock, and 11.5M shares of Gray common stock. The transaction has been approved unanimously by the boards of both Gray and Raycom. The transaction has also been approved by the requisite vote of the Raycom shareholders. No Gray shareholder vote will be required. Gray shareholders will retain 89 percent of the economic ownership of the company following the closing.

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Publication:The Fly
Date:Jun 25, 2018
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