Gray Television Inc. has agreed to acquire Raycom Media Inc. in a deal that includes Cleveland’s WOIO Channel 19. The acquisition creates the single largest owner of leading local television stations in the country. Under the terms of the merger, Gray will acquire Raycom for $3.647 billion in total proceeds, consisting of $3.547 billion in enterprise value and $100 million of Raycom cash. The consideration will consist of $2.85 billion in cash, $650 million in a new series of preferred stock and 11.5 million shares of Gray common stock. Including Cleveland’s WOIO, the deal brings together:

  • 142 full-power television stations serving 92 markets, the third-largest portfolio of stations and markets in the country, reaching 24 percent of U.S. television households.
  • 62 television stations ranked first in all-day Nielsen ratings in their local markets.
  • 92 percent of markets with the No. 1 or the No. 2 Nielsen-rated local television station.

Gray also will acquire several additional Raycom businesses, including:

  • Raycom Sports, a marketing, production and events management and distribution company.
  • Tupelo Raycom, a sports and entertainment production company.
  • RTM Productions, an automotive programming production and marketing solutions company.
  • Broadview Media, a post-production/digital signage company.

As part of the deal, Raycom will sell or spin off Community Newspaper Holdings, Inc., which owns community newspapers and information products with more than 100 titles across 23 states, as well as PureCars, a digital ad platform for the automotive industry. Excluding CNHI and PureCars, the combined net revenue of both companies on a blended 2016/2017 basis would total approximately $2 billion. The transaction has been approved by the boards of both companies. 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. The transaction is subject to customary closing conditions and regulatory approvals. The parties expect to close the transaction in the fourth quarter of 2018.