Gannett, Belo Reach Agreement With DOJ

(RTTNews) - Gannett Co., Inc. (GCI) and Belo Corp. (BLC) said Monday that they have reached an agreement with the U.S. Department of Justice that should enable the companies to complete the previously announced acquisition of Belo in 2013.

In June, Gannett agreed to buy television company Belo for $13.75 per share or about $1.5 billion, plus the assumption of $715 million in existing debt, in an all-cash deal valued at about $2.2 billion.

The Belo deal remains subject to approval by the Federal Communications Commission and other customary closing conditions.

Gannett, Belo and Sander Media LLC, a third party operator who will acquire certain broadcast stations in markets where Gannett and Belo overlap, entered into a proposed consent decree with the DOJ, pursuant to which Gannett and Sander will divest substantially all of the assets used in the operation of KMOV-TV in St. Louis, Missouri, which is currently owned by Belo. The divesture is expected to occur in 2014.

The synergies associated with KMOV-TV were nominal given the structure of the Belo deal, and Gannett expects very minimal impact on its previously disclosed projected annual run-rate synergies of $175 million within three years of closing of the Belo deal.