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CBS, Viacom agree to merge; Verizon selling Tumblr to WordPress parent

S&P Global Market Intelligence provides a wrap-up of U.S. companies' technology, media and telecommunications deal announcements, completions and updates from Aug. 13 to Aug. 19.

Announcements

* Affiliates of private equity firm Siris Capital Group LLC entered into a definitive agreement to buy TPx Communications, which provides unified communications and cloud-focused managed information technology services, from investors including affiliates of Investcorp and Clarity Partners. Financial terms of the transaction, which is subject to regulatory approvals and customary closing conditions, was not disclosed. The deal is expected to close in the first or second quarter of 2020.

* Private equity firm Grain Management LLC struck a deal to acquire a majority interest in Summit Broadband Inc., a provider of fiber optic-based telecom services in central and southwest Florida, from Cable Bahamas Ltd. The transaction, terms of which were not disclosed, is expected to be completed in the fourth quarter, subject to regulatory approvals and other customary closing conditions. The private equity firm is also acquiring a majority stake in Ritter Communications Inc., which offers internet, phone, video services and cloud services to customers in Tennessee and Arkansas.

* Sonic Financial Corp. unit Speedco Inc. commenced a tender offer to buy all of the outstanding shares of Speedway Motorsports Inc.'s common stock at $19.75 per share in cash. The tender offer period will expire one minute after 11:59 p.m. ET on Sept. 16, unless extended or earlier terminated. The closing of the tender offer is subject to several conditions. After completion of the tender offer, Sonic Financial will buy all remaining shares of Speedway Motorsports stock not held by Sonic Financial or Speedco at $19.75 per share through a merger of Speedco and Speedway Motorsports in which Speedway Motorsports will be the surviving corporation and will become a wholly owned subsidiary of Sonic Financial.

* Salem Media Group Inc. agreed to sell nine AM stations and four FM translators in eight markets to Relevant Radio for about $8.7 million. The markets include Boston, Atlanta, Houston, Dallas, San Antonio, St. Louis, Denver and Youngstown, Ohio. Relevant Radio said the acquisition of these stations, along with earlier purchases of Salem stations, will allow it to expand its reach by an additional 60 million listeners. In total, Relevant Radio is buying 14 AM stations and seven FM translators from Salem for $17.7 million.

* Funds advised by private equity firm BC Partners agreed to buy Presidio Inc., which provides IT solutions, in an all-cash deal worth about $2.1 billion, including net debt. The deal contains a go-shop provision whereby Presidio may actively solicit alternative acquisition offers for a period of 40 days. The company has the right to terminate the deal in favor of a superior proposal, subject to the agreement's terms and conditions.

* CBS Corp. and Viacom Inc. on Aug. 13 officially announced plans to recombine in an all-stock merger. The companies, which split more than a decade ago, said in a joint statement that they would be better served through a reunion, as their combined assets and enhanced scale could allow the combined entity to compete more effectively in an evolving media landscape. The combined company will be known as ViacomCBS Inc. Under the terms of the deal, existing CBS shareholders will own approximately 61% of the combined company and existing Viacom shareholders will own approximately 39% of the combined company on a fully diluted basis. Each Viacom class A voting share and Viacom class B nonvoting share will convert into 0.59625 of a class A voting share and class B nonvoting share of CBS, respectively. The transaction is expected to close by the end of calendar 2019. Viacom President and CEO Bob Bakish will head the combined company as CEO, while CBS President and acting CEO Joe Ianniello will maintain day-to-day leadership over CBS assets, including broadcast network CBS (US) and CBS-owned TV stations. CBS Corp. CFO Christina Spade will become CFO for the combined company.

* Verizon Communications Inc. agreed to sell Tumblr Inc. to WordPress owner Automattic Inc. for an undisclosed amount. Automattic is taking on 200 employees as part of the deal. Tumblr, a social media network that is home to 475 million blogs, was reportedly bought by Automattic for less than $20 million, while another source puts it below $10 million, according to Axios. The amount is a drop in value over $1.1 billion price that Yahoo, now called Altaba Inc., reportedly paid when it purchased Tumblr in 2013. Verizon, which acquired Tumblr in 2017 as part of its purchase of Yahoo's operating business, started to explore a sale of the blogging website early this year to rebrand Verizon Media Group, formerly known as Oath Inc.

Completions

* Middle-market private equity firm Alpine Investors sold Perennial EdTech LLC, which offers student management, student assessment, teacher evaluation and health office management software, to Frontline Education. Financial terms of the deal were not disclosed. Frontline Education provides school administration software.

Updates

* U.S. Federal Communications Commission Chairman Ajit Pai on Aug. 14 formally recommended the approval of the proposed T-Mobile US Inc.-Sprint Corp. merger. The chairman circulated a draft order for the FCC to sign off on the deal should the order be approved by the full commission. The FCC approval is the last federal regulatory hurdle for the transaction after the U.S. Justice Department conditionally approved the deal July 26. Pai announced support for the deal in May, after receiving a set of commitments from the wireless companies around the deployment of next-generation 5G service, as well as a pledge to divest Sprint's Boost Mobile prepaid brand.

A court challenge involving more than a dozen state attorneys general opposed to the deal remains unresolved. The trial date for the case was recently pushed back from October to early December. Additionally, the California Public Utilities Commission, which is determining whether to approve the deal within California, has not yet made a determination on a pending application to the commission.