Comedian-turned-media-mogul Byron Allen has submitted an all-cash offer to buy TV station owner Tegna Inc. for $8.5 billion, including debt, a person familiar with the matter said Wednesday.
Allen’s Los Angeles company, Allen Media Group, offered $20 a share for Tegna, one of the largest TV station owners in the U.S. Tegna owns 62 television stations in large and medium-size markets, including San Diego, Sacramento, Seattle and Phoenix.
Tegna shares plunged $1.42, or 8.1%, to $16.02 on Wednesday amid broad market concerns about the novel coronavirus outbreak.
The Tysons, Va., company produced $2.3 billion in revenue last year, according to corporate filings.
A Tegna representative declined to comment. A representative for Allen Media Group was not immediately available for comment.
Allen’s offer would be financed with a combination of equity and debt, according to the person familiar with the situation who was not authorized to comment.
The bid would compete with previous offers for the publicly traded broadcaster from New York private equity giant Apollo Global Management and, separately, Gray Television of Atlanta.
Gray Television last week offered $20 a share in cash and stock. On Friday, Apollo moved to match Gray’s offer with an all-cash bid after first making an overture to Tegna a year ago, according to the Wall Street Journal.
Buying Tegna would significantly grow Allen’s media footprint. Allen founded his company, also known as Entertainment Studios, in 1993, selling a weekly celebrity interview show to television stations.
Before launching the company, Detroit-born Allen appeared on “The Tonight Show Starring Johnny Carson” when he was 18 and later joined the TV show “Real People.”
Allen’s company now owns television channels such as Pets.TV and Cars.TV, as well as a film distribution arm known for movies including the shark movie “47 Meters Down.”
In 2018, the media entrepreneur acquired the Weather Channel cable network for $300 million.
Allen also gained notoriety for a racial bias lawsuit against Comcast Corp. that recently went before the U.S. Supreme Court.
In 2015, Allen sued Comcast and Charter Communications, alleging their refusal to carry his channels was the result of racial bias.
Supreme Court justices in November heard appeals from the two cable TV giants seeking to block the suits filed by Allen.
The cable giants contended that a civil rights suit may not go forward unless the plaintiff sets out evidence in a complaint showing that race was the deciding factor in the companies’ decision. That standard would make it far harder for civil rights plaintiffs to bring discrimination lawsuits.
The high court has not yet issued its decision on whether to allow the suit to proceed.
Tegna has spent the last seven years reshaping the company. Previously known as Gannett, it jettisoned its newspapers, including USA Today, in 2015. Last year, it acquired more than a dozen TV stations, including from Nexstar Media Group and the Dispatch Broadcast Group. It also consolidated control in the multicast networks Justice and Quest.