Martore did not foreclose the possibility of more deals. When asked if Gannett's leverage targets would preclude more acquisitions, she said, "No, absolutely not." Groups like Nexstar Broadcasting Group Inc. and Sinclair have been acquisitive on a smaller scale. Media General Inc. is combining with New Young Broadcasting Holding Co.
Gannett's bid triggered a rally in TV shares. Nexstar Broadcasting gained $2.22 per share on Thursday afternoon, climbing more than 8%, to $29.41. Sinclair rose $3.14, or 13%, to $27.23. Lin TV Corp. increased by $1.63, more than 14%, to $13.18. Gray Television Inc. was up 80 cents, or nearly 15%, to $6.24.
Martore emphasized the benefits of combining the two TV groups.
Marci Ryvicker of Wells Fargo Securities LLC wrote in a Thursday report that Gannett's payout metric implies a valuations of $50 for Nexstar, $35 for Sinclair, $26 for Lin and $7 for Gray. The companies expect to close the deal by the end of 2013. The transaction carries a 3.5% breakup fee.
Written by Chris Nolter in New York