Wells Fargo analyst Marci Ryvicker explains to clients what the flurry of press releases on Thursday regarding Nexstar, Meredith and Media General mean.
Nexstar and Media General want to combine but Meredith “refuses to back away & is using the incentive auction as bait,” she writes in a client note.
Nexstar and Media General have negotiated an agreement whereby NXST would acquire MEG for $17.66/sh in equity.
Her thoughts: “Now we know what’s held up the Nexstar and Media General deal. “It sounds like Meredith is unwilling to terminate any relationship with Media General, which is required for MG and Nexstar to move forward. “The big hiccup here is the incentive auction — as we understand it, any potential transaction must be filed with the FCC by January 12th. The one thing we would point out is that while MEG has reiterated its intent to participate in the auction, NXST has not,” she writes.