Boston, MA 06/14/2013 (wallstreetpr) – Shares of Gannett Co., Inc. (NYSE:GCI) were up by 34.01% in Thursday’s trading session after it announced that it would be acquiring Belo Corp. Shares of Gannett Co., Inc. (NYSE:GCI) closed at $26.60 and traded way above its average volume of 3.09M. Total no of shares traded in yesterday’s trading session were at 36.11M.
Gannett Co., Inc. (NYSE:GCI) is a publicly traded media holding company. It is the largest U.S. newspaper publisher as measured by total daily circulation. It owns 23 television stations through Gannett Broadcasting Inc. and is the largest group owner of NBC-affiliated stations and holds substantial properties in digital media. The shares of the company have surged to a five-year high since June 2008.
After acquiring Belo Corp., Gannett’s broadcast portfolio will increase from 23 to 43 stations. The merger will lead Gannett into the nation’s fourth-largest owner of major network affiliates. Gannett has successfully transformed itself into a diversified multi-media company with broadcast, publishing and digital components. This step will surely help Gannett to quickly generate cash flows and pay their debts while remaining committed towards their disciplined capital allocation. Gannett also said that there will be an increase in their operating income by about 50 cents per share in the first year. It will also result in some savings of $175 million within three years after closing. Upon completion of the said transaction, Gannett’s Broadcast segment will have a larger geographical region to be served with revenue diversity. If the transaction is approved, Gannett’s Broadcast segment shall contribute more than half of the company’s pro-forma EBDITA.
The transaction is likely to be completed by the end of 2013 subject to certain approvals which are Federal Communications Commission (FCC) approval; approval from shareholder’s holding two-third of the voting rights and customary closing conditions. Gannett’s executives have said that they don’t expect any regulatory problems.
