Sinclair proposes to acquire E.W. Scripps for $7.00 per share in cash and stock

In a regulatory filing, Sinclair (SBGI) disclosed that on November 24, the company submitted a proposal to acquire all of the outstanding shares of capital stock of The E.W. Scripps (SSP) Company that the reporting person does not already own. Under the proposal, shareholders will receive $7.00 per share, consisting of $2.72 in cash and $4.28 in combined company common stock based on approximately $325M in estimated synergies and on a 7.0x EV/ EBITDA multiple, in line with current trading levels for leading broadcast groups. The $7.00 per share price represents a 200% premium to the Scripps Company’s 30-day volume-weighted average price as of November 6, the last trading day prior to significant buying activity from Sinclair, the company stated. “The $2.72 cash component alone represents a 16% premium of the Issuer’s 30-day VWAP, providing immediate and tangible value creation. Under the terms of the Proposal, the Issuer’s shareholders may elect to receive all-cash or all-stock consideration for each of the shares of the Issuer, subject to proration to the maximum cash and equity amounts detailed in the Proposal. Upon closing, shareholders of the Issuer would own approximately 12.7% of the combined entity,” the filing added.