Weschler also stated, “As the media industry continues its rapid evolution, Berkshire Hathaway is fortunate to partner with this management team and the Scripps family, who have successfully anticipated the future of media for over a century.”
The stock price of Scripps jumped nearly 23%, on the announcement that Berkshire Hathaway is backing Scripps acquisition of ION Media. Analysts were pleased that the transaction obtained Buffett’s seal of approval.
“We expect investor interest in SSP to accelerate on the back of this deal,” said Wells Fargo Securities analyst Steven Cahall.
Scripps acquisition of ION Media will double its EBITDA
Scripps described its acquisition of ION Media as a transformative transaction that will double its earnings before interest, taxes, depreciation, and amortization (EBITDA) and will yield in $500 million synergies over the next six years.
The combination of Scripps’ Katz networks and ION Media will create a full-scale national television network business. The companies’ networks operate in the over-the-air (OTA) television marketplace, which experienced a 67% growth to 25% of all TV households, according to a Parks Associates research.
