Scripps Launches Proposed Private Placement Of Senior Notes

The E.W. Scripps Company's (NASDAQ: SSP) wholly-owned subsidiary, Scripps Escrow, Inc., has launched an offering of $400 million of new senior unsecured notes. The notes are expected to mature in 2027. 

The private offering is subject to market conditions and other factors and is exempt from the registration requirements of the Securities Act of 1933. The escrow issuer, which was created solely to issue the notes, will deposit the gross proceeds of the offering into a segregated escrow account until the date that certain escrow release conditions are satisfied. Upon the closing of the Nexstar acquisition discussed below, the escrow issuer will merge with and into the company, and the escrow proceeds will be released to the company. The company will thereupon assume the obligations under the notes, and the notes will become senior unsecured obligations of the company. The notes will be guaranteed by certain of the company's existing and future subsidiaries. Completion of the offering is subject to customary closing conditions.

On March 20, 2019, Scripps announced it would acquire eight stations in seven markets that are being divested in connection with Nexstar Media Group's pending acquisition of Tribune Media, for $580 million.

Scripps is seeking to finance the acquisition with $400 million, eight-year senior unsecured notes as well as $180 million of cash from the balance sheet, including a portion of the proceeds from the Cordillera financing. The company's net leverage, pro forma for the issuance of the notes, would be 5.3x, based on pro forma annual average adjusted EBITDA of $363 million for the last eight quarters ended March 31, 2019.

The acquisition will grow the Scripps local television station portfolio to 62 stations in 42 markets with a reach of 30 percent of U.S. TV households.

SOURCE: Scripps