E.W. Scripps Co. (SSP) confirms agreement to sell Triton Digital to iHeartMedia (IHRT) for $230 million
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The E.W. Scripps Company (NASDAQ: SSP) has entered into an agreement with iHeartMedia (NASDAQ: IHRT) to sell Triton Digital for $230 million – a cash-on-cash return of 1.6x for a business Scripps acquired in late 2018.
Triton is the global technology and services leader for the digital audio and podcast industry. Scripps bought the company for $150 million, and it has been accretive to segment margins since then.
Scripps – which sold its podcast company Stitcher in October and nearly doubled its return on that investment – was an early entrant into podcasting and digital audio.
The Triton divestiture reflects Scripps' consistent invest-for-growth strategy that capitalizes on emerging media marketplaces to unlock shareholder value.
"The sale of Triton creates significant value for Scripps' shareholders and employees, as we close a chapter on our growth of digital audio businesses through a series of successful transactions and a focus on prudent operations, including our core TV business," said Adam Symson, Scripps president and CEO. "We believe iHeartMedia is a perfect fit for Triton Digital given their focus and position as the leader in audio solutions."
Scripps Chief Financial Officer Jason Combs said the company would use proceeds from the Triton sale to pay down debt.
"We remain focused on bringing our debt back down to our company's historical levels as quickly as possible while at the same time we reap the financial benefits of being a new leader in national television as we have been in local broadcast," Combs said.
- Sale price of $230 million, representing an internal rate of return after taxes in the mid-20% range and a low teens EBITDA multiple
- Proceeds from the sale used primarily to pay down debt
- Tax liability effective rate of 5%
- The move of all Triton employees to iHeart
The Triton transaction is expected to close in the first quarter, pending Hart-Scott-Rodino clearance.
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