Gray Television, Inc. (NYSE: GTN) is having an overwhelmingly strong start to the trading session this morning, and for good reason. The company announced a deal under which it will acquire a new asset. Of course, the news excited investors, sending the stock screaming for the top. Today, we’ll talk about:
- The acquisition news;
- what we’re seeing from GTN as a result; and
- what we’ll be watching for ahead.
GTN Heads For The Top On Asset Acquisition
As mentioned above, Gray Television is having an incredibly strong start to the trading session this morning after reaching a deal to acquire a key asset. In a press release issued early this morning, the company announced that it had reached an agreement to buy Raycom Media Inc. in a deal with a value of $3.65 billion. This includes $100 million of Raycom Cash.
In the release, GTN announced that the deal will consist of $2.85 billion in cash, $650 million in a new series of preferred stock and 11.5 million shares of GTN common stock. The company said that while the deal is still subject to customary closing and regulatory conditions, it is expected that the transaction will close in the fourth quarter of this year. In a statement, Hilton H. Howell, Jr., President and CEO at GTN, had the following to offer:
Today we announce the transformation of Gray Television into a true leader in the broadcast television industry… Combining our company with the excellent Raycom stations and the superb Raycom employees will create a powerhouse local media operation. Together, this new portfolio of leading local media outlets will excel at what they do best, which is to provide the local news that local communities trust, the entertainment and sports content that viewers crave, and the incredible reach that advertisers demand. Indeed, this is a transaction in which there can be no doubt that local community standards will be honored and embraced. We are excited to welcome the dedicated reporters, account executives, and technologists of Raycom to our growing corporate family. On behalf of the Board, our employees, and our investors, I convey our deepest gratitude to Jim Ryan and Kevin Latek for leading our efforts on this momentous, transformative transaction.
What We’re Seeing From The Stock
As investors, one of the first lessons that we learn is that the news moves the market. In the case of Gray Television, the news proved to be overwhelmingly positive. After all, the asset acquisition may become a substantial revenue generator for the company. So, it’s no surprise that excited investors are sending the stock screaming for the top. Of course, our partners at Trade Ideas were the first to alert us to the gains. Currently (10:03), GTN is trading at $14.00 per share after a gain of $1.20 per share or 9.37% thus far today.
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What We’ll Be Watching For Ahead
Moving forward, the CNA Finance team will continue to keep a close eye on GTN. In particular, we’re interested in following the story surrounding the company’s newly acquired asset and how the company plans on merging Raycom in and generating revenue through the asset. Nonetheless, we’ll continue to follow the story closely and bring the news to you as it breaks!
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