TEGNA shares are trading up on Tuesday: what happened?

Shares of TEGNA Inc (NYSE: TGNA) are up roughly 7.0% on Tuesday after Standard General L.P. said it will buy the media company for $8.60 billion, including debt.

TEGNA shareholders to relish a 14% premium

The cash deal with the private equity company translates to $24 a share for TEGNA stockholders, which represents a 14% premium on where TGNA closed the regular session on Friday.

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TEGNA operates in 51 markets and owns 64 U.S. TV stations. Notable names like Twist, Crime, and Quest Networks are also its subsidiaries. In the press release, TEGNA CEO Dave Lougee said:

This transaction is the next step in TEGNA’s evolution and recognises the value of our portfolio. At all levels, we’ve been tireless in our efforts to ensure TEGNA effectively serves all of our stakeholders. We’re confident in TEGNA’s future under Deb’s leadership.

Deb McDermott is set to serve as the CEO of TEGNA. He’s currently the chief executive at Standard Media. Earlier this month, TEGNA reached a new carriage agreement with DISH.

TEGNA to become a private company

Standard General plans on delisting TEGNA from the NYSE to turn it into a private company. The deal has been unanimously approved by the TEGNA board, but customary closing conditions, including regulatory approval and a nod from TEGNA shareholders, are yet to be met.

Once the transaction is complete, which is expected in the back half of 2022, Standard General’s founding partner, Soo Kim, will take on the role of chairman at TEGNA. Kim said:

TEGNA has a strong foundation and exciting prospects for continued growth as a result of the stewardship of the Board and the current management team. We look forward to building on the Company’s strong foundation and leveraging Deb’s deep industry experience to drive further growth.