NEW YORK (CNNfn) - Cox Communications Inc. said Thursday it agreed to buy Media General Inc. cable systems serving 260,000 customers in Virginia for $1.4 billion, helping to expand the cable operator's presence in the Southeast.
The all-cash deal is expected to close later this year, pending government and regulatory approval. The Atlanta-based Cox (COX) will operate all cable programming in the region, which will stretch throughout most of Virginia and into parts of the Washington D.C., metropolitan area.
While Media General (MEG.A) isn't sure what it will do with the proceeds from the sale, it anticipates it will probably pay down some of its debt, initiate a share-buyback program and consider additional acquisitions of television and newspaper properties, said J. Stewart Bryan, the chief executive of the Richmond, Va.-based company. It already owns a number of newspapers and television stations, plus information services and newsprint recycling.
Once the Cox transaction is completed, Media General will continue to supply news and information through a dedicated channel on the cable system.
Shares of Cox Communications jumped 3-5/16 to 72-1/2 in New York. Media General shares fell 1 to 44-7/8.