Gannett (GCI) Completes Takeover of ReachLocal, Inc.

August 9, 2016 10:31 AM EDT

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Gannett Co., Inc. (NYSE: GCI) announced today that it has completed the previously announced acquisition of ReachLocal, Inc. ("ReachLocal"). ReachLocal, a leader in powering online marketing, helps local businesses grow and operate their business better with leading technology and expert service providing digital lead generation, advertising, marketing, web presence and other digital solutions.

"Today marks an important milestone in Gannett's transformation and leadership in digital media," said Robert Dickey, Gannett president and chief executive officer. "The addition of ReachLocal's market-leading digital marketing services and solutions will increase our overall digital revenues by roughly 50% and we expect that our overall digital revenues will now approach $1 billion in 2017. We expect that in its first full year of operations following the acquisition, ReachLocal will be approximately neutral to our earnings per share, and slightly accretive in the second full year." Sharon Rowlands, ReachLocal CEO added "ReachLocal is focused on building the best digital marketing solutions to help local businesses achieve their goals, and we are excited to accelerate this strategy around the globe with Gannett."

Details of Tender Offer and Merger

Gannett completed the acquisition at a price per share of $4.60, net to the holder in cash (less any applicable withholding taxes and without interest) through a tender offer followed by a merger. The tender offer expired at 12:00 midnight, New York City time, at the end of the day on August 8, 2016. Computershare Trust Company, N.A., the depositary for the tender offer, advised that, as of the expiration of the tender offer, a total of 27,754,605 shares had been tendered into and not withdrawn from the tender offer, representing approximately 92.16% of ReachLocal's outstanding shares. Additionally, the depositary advised that an additional 28,435 shares had been tendered by notice of guaranteed delivery, representing approximately 0.09% of ReachLocal's outstanding shares. All validly tendered shares were accepted for payment, which will be made in accordance with the terms of the tender offer.

Subsequently, Raptor Merger Sub, Inc., a wholly owned subsidiary of Gannett, merged with and into ReachLocal with ReachLocal continuing as the surviving corporation. The merger was completed without a vote of ReachLocal stockholders pursuant to Section 251(h) of the Delaware General Corporation Law. In the merger, each remaining share of ReachLocal that was not validly tendered, subject to several exceptions specified in the tender offer, was canceled and converted into the right to receive the same price per share of $4.60 in cash (less any applicable withholding taxes and without interest) that was paid in the tender offer. As a result of the merger, ReachLocal is now a wholly owned subsidiary of Gannett.

ReachLocal's shares will cease trading on the NASDAQ Global Select Market before the market opens on August 10, 2016, and will no longer be listed.

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