E.W. Scripps vows to ‘protect’ itself from takeover bid by ‘opportunistic’ Sinclair

Adam Symson (left) and Chris Ripley Feat

US television station group The E.W. Scripps Company has vowed to stave off the “opportunistic actions” of larger station group Sinclair, which on Monday revealed it had taken an 8.2% stake in Scripps.

In a securities filing on Monday morning, Sinclair said it had acquired the Class A (non-voting) shares “in contemplation of a possible combination,” claiming it had been involved in “constructive discussions” with Scripps about a merger for several months.

The Maryland-headquartered company said a merger could lead to US$300m in annual cost savings. It added that, against a backdrop of industry consolidation and growing competition, station groups need to combine to “address secular headwinds and compete effectively with larger-scale big-tech and big-media players, as well as major broadcast groups.”

Several media reports suggest that the talks between the companies ended without a deal. Sinclair, led by president and CEO Chris Ripley, has around 180 stations in 85 markets while Scripps, under president and CEO Adam Symson, has upwards of 60 in more than 40 markets across the US.

Scripps responded on Monday afternoon with a statement saying its board and management were “aligned on doing only what is in the best interest of all of the company’s shareholders as well as its employees and the many communities and audiences it serves across the United States.”

It added that it will continue to look at transactions or other moves that could boost the company’s value but closed its statement by taking a shot at the way Sinclair has gone about its business.

“The board will take all steps appropriate to protect the company and the company’s shareholders from the opportunistic actions of Sinclair or anyone else,” it said.

Scripp’s stock jumped by almost 40% to US$4.28 per share following the release of Sinclair’s securities filing.

Amid massive pressures facing TV station groups, many are exploring ways to merge or scale up in order to survive.

In addition to the Scripps-Sinclair talks, America’s largest television station owner, Nexstar Media Group, in August revealed plans to acquire fellow broadcasting group Tegna for around US$6.2bn.

The transaction, which requires regulatory approval from the Federal Communications Commission, would create a combined entity with 265 television stations in 44 states, including 132 of America’s 210 designated market areas and nine of the top 10 markets. Nexstar also said the Tegna deal would save around US$300m annually.