E.W. Scripps Company’s $2.65 Billion Acquisition of ION Media

BakerHostetler and Brooks Pierce served as Scripps’ legal co-counsel for the acquisition, and Simpson, Thacher & Bartlett LLP served as Scripps’ legal counsel for the committed financing. Kirkland & Ellis served as Scripps family legal counsel. Skadden, Arps, Slate, Meagher & Flom LLP and Cooley LLP served as legal counsel for ION Media. Akin Gump Strauss Hauer & Feld LLP advised Black Diamond on the deal.

The E.W. Scripps Company will buy national broadcast network ION Media for $2.65 billion, combining the business with Scripps’ Katz networks and Newsy to create a full-scale national television networks business.

The transaction is expected to be financed with $1.85 billion of secured and unsecured debt and a $600 million investment from Berkshire Hathaway in preferred stock. The debt financing is being led by Morgan Stanley Senior Funding, Inc.

Berkshire Hathaway also will receive a warrant to purchase up to 23.1 million Class A shares, at an exercise price of $13per share.

ION Media, based in West Palm Beach, Florida, operates a national television network featuring popular crime and justice procedural programming. It is being purchased from an entity controlled by Black Diamond Capital Management.

Together, ION, Katz and Newsy, Scripps’ new national networks business, will reach nearly every American through free over-the-air broadcast, cable/satellite, over-the-top and digital distribution, with multiple advertising-supported programming streams.

The E.W. Scripps Company (NASDAQ: SSP) advances understanding of the world through journalism. As the nation’s fourth-largest independent TV station owner, Scripps operates 60 television stations in 42 markets. Scripps empowers the next generation of news consumers with its multiplatform news network Newsy and reaches growing audiences through broadcast networks including Bounce and Court TV.

Methuselah Advisors and Morgan Stanley & Co. LLC acted as financial advisors to Scripps and arranged the preferred equity investment by Berkshire Hathaway. Morgan Stanley Senior Funding, Inc. provided the financing commitments for the secured and unsecured debt. Evercore served as exclusive advisor to the Scripps family.

The Skadden team advising ION Media included M&A partner Kimberly deBeers (Chicago; Picture) and associates Graeme Waller (Chicago) and Justin Levin (Chicago), Tax partner Sally Thurston (New York) and associate Michael Cardella (New York), Antitrust/Competition partner Matthew Hendrickson (New York), Executive Compensation & Benefits counsel Berit Freeman (New York), and Labor & Employment Law partner David Schwartz (New York).

The Simpson Thacher team for the committed debt financing included Alden Millard, Mike Vernace, Michael Brennan and Samuel Wintergreen-Arthur (Banking and Credit); and Art Robinson and Jonathan Ozner (Capital Markets).

The Cooley Team was led by John Feore and Jason Rademacher and also included Robert M. McDowell and Henry Wendel.

The Akin Gump team advising Black Diamond was led by communications and information technology senior counsel Tom Davidson. It also included senior counsel Karen Milne, and associates Shea Boyd and Virginia Hiner.

Involved fees earner: Shea Boyd – Akin Gump; Tom Davidson – Akin Gump; Virginia Hiner – Akin Gump; Karen Milne – Akin Gump; John Feore – Cooley LLP; Robert McDowell – Cooley LLP; Jason Rademacher – Cooley LLP; Henry Wendel – Cooley LLP; Michael Brennan – Simpson Thacher & Bartlett; Alden Millard – Simpson Thacher & Bartlett; Jonathan Ozner – Simpson Thacher & Bartlett; Arthur Robinson – Simpson Thacher & Bartlett; Michael Vernace – Simpson Thacher & Bartlett; Michael Cardella – Skadden Arps Slate Meager & Flom; Kimberly deBeers – Skadden Arps Slate Meager & Flom; Berit Freeman – Skadden Arps Slate Meager & Flom; Matthew Hendrickson – Skadden Arps Slate Meager & Flom; Justin Levin – Skadden Arps Slate Meager & Flom; David Schwartz – Skadden Arps Slate Meager & Flom; Sally Thurston – Skadden Arps Slate Meager & Flom; Graeme Waller – Skadden Arps Slate Meager & Flom;

Law Firms: Akin Gump; Cooley LLP; Simpson Thacher & Bartlett; Skadden Arps Slate Meager & Flom;

Clients: Black Diamond Capital Management, L.L.C ; E. W. Scripps Company; Ion Media Networks;

Author: Ambrogio Visconti