Raycom Buying Liberty Corp.

The $877 million deal will form a big Southern television broadcaster.
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Closely held Raycom is buying rival TV station owner

Liberty Corp.

(LC) - Get Report

for $877 million in cash.

Shareholders in Greenville, S.C.-based Liberty will get $47.35 a share in cash, a 26% premium to Thursday's closing price. The deal will combine Liberty, owner of 15 stations in the South, with Montgomery, Ala.-based Raycom Media, an employee-owned operator of 37 stations in 20 states.

"Broadcasting has been essential to the success of Liberty Corporation for 70 years of the century we've been in business," said Liberty chief Hayne Hipp. "The transaction we announce today is testimony to the exemplary reputation we've built as both a standard-bearer in the industry and a champion of each community in which we serve."

Liberty has eight NBC affiliates and seven other network-affiliated stations.

"In Raycom, we have found a company whose stellar record of public service and commitment to local news and information mirror our own," continued Hipp. "This transaction will afford our employees the opportunity to flourish within a company dedicated to the television broadcasting business, and enable our shareholders to realize full and fair value."

The Federal Communication Commission and Liberty shareholders must yet approve the final deal. The company says it has over 20% shareholder support for the deal.

Liberty rose 70 cents ahead of the announcement Thursday to close at $37.45.