Record Date of May 18, 2017; Separation Expected to Be Completed May
31, 2017
TEGNA Stockholders to Receive One Share of Cars.com Stock for Every
Three TEGNA Shares
Cars.com to Pay TEGNA One-Time Cash Distribution of $650 Million
MCLEAN, Va.--(BUSINESS WIRE)--May 3, 2017--
TEGNA Inc. (NYSE: TGNA) today announced that its Board of Directors has
approved the previously announced spin-off of Cars.com, which will
create two publicly traded companies: TEGNA, an innovative media company
with the largest broadcast group among major network affiliates in the
top 25 markets; and Cars.com, a leading digital automotive marketplace.
The spin-off will be effected through a pro rata distribution of all
outstanding shares of Cars.com to TEGNA stockholders of record at the
close of business on May 18, 2017 (the “Record Date”). Stockholders will
retain their TEGNA shares and receive one share of Cars.com for every
three shares of TEGNA stock they own on the Record Date. Cars.com shares
are expected to begin “regular way” trading on June 1, 2017. The
spin-off remains subject to the conditions described in the preliminary
information statement filed by Cars.com on Form 10 with the U.S.
Securities and Exchange Commission.
Gracia Martore, President and CEO of TEGNA, who will retire upon the
closing of the spin-off, said, “Today’s milestone brings us one step
closer to creating two industry-leading companies with the right focus,
resources and leadership to capture the unique opportunities in each of
their rapidly evolving industries. This spin-off is the culmination of a
multi-year transformation of our company, and the Board is confident
that both companies are well positioned to execute their strategic plans
for growth and create shareholder value.”
Dave Lougee, who will serve as President and CEO of TEGNA upon
completion of the separation, added, “I am honored to lead TEGNA into
the future at such a pivotal time for our company. With our strong
capital structure, we are well-positioned to take advantage of current
and future regulatory changes. We will continue TEGNA’s history of
serving our local communities by creating and distributing innovative
and compelling content across a wide range of platforms and by providing
our clients marketing tools and services to enable them to succeed in
the digital age.”
Alex Vetter, who will serve as President and CEO of Cars.com upon
completion of the separation, said, “We are approaching a watershed
moment for Cars.com and I couldn’t be more excited about our future. As
an independent company, we have greater flexibility to capture the
opportunities ahead of us by leveraging our strong brand, innovative
platform and expanding, loyal audience. We are a pure-play digital
company in an excellent position to drive long-term growth and
profitability, and we are a unique investment opportunity in the digital
automotive space.”
Upon completion of the separation, TEGNA will continue to trade on the
New York Stock Exchange under the ticker symbol TGNA and Cars.com will
trade regular way on the New York Stock Exchange under the symbol CARS.
Holders of TEGNA common stock who sell TEGNA shares regular way on or
before May 31, 2017 will also be selling their right to receive shares
of Cars.com common stock in the distribution. Investors are encouraged
to consult with their financial advisors regarding the specific
implications of buying or selling TEGNA common stock before the
distribution date.
John A. (Jack) Williams, President of TEGNA Digital, will retire upon
the closing of the spin-off. Ms. Martore added, “Jack joined the company
22 years ago and has been instrumental in leading our Digital portfolio
since 2008. I want to thank Jack for all that he has done for this
company and wish him well in his retirement.”
Capital Structure
Prior to the separation, Cars.com will make a one-time cash distribution
of $650 million to TEGNA. Cars.com expects to enter into new credit
facilities with borrowing capacity of approximately $900 million and
expects a portion of the facilities will remain undrawn at closing. It
intends to invest in organic growth initiatives and selective
acquisitions to create shareholder value and does not anticipate paying
a cash dividend.
It is expected that TEGNA's existing credit facility will remain in
place following the transaction, and the company expects to target
long-term leverage levels in line with its peers. The company intends to
use the $650 million tax free distribution from Cars.com and cash flow
from operations to reduce leverage and, to that end, will extinguish its
current share repurchase program, with plans to reassess in the future.
TEGNA expects to pay a regular cash dividend of $0.28 per share
annually. The company intends to continue investing in organic and
strategic growth opportunities and also intends to maintain the
financial flexibility to pursue strategic acquisitions when appropriate.
TEGNA Board of Directors
Current TEGNA Board Chairman Marjorie Magner will continue to serve as
chairman of TEGNA’s Board of Directors following the separation and will
be joined by Dave Lougee, who will be TEGNA’s president and CEO
following the separation. TEGNA’s Board of Directors will also include
current TEGNA directors Jennifer Dulski, Howard D. Elias, Lidia Fonseca,
Scott K. McCune, Henry W. McGee, Susan Ness, Bruce P. Nolop and Neal
Shapiro.
Cars.com Board of Directors
Scott Forbes will serve as chairman of the Cars.com Board of Directors
following the separation. The Cars.com Board of Directors will also
include Alex Vetter, Cars.com President and CEO, and current TEGNA
director Jill Greenthal. In addition, upon completion of the separation,
Thomas Hale, Donald McGovern and Greg Revelle are expected to serve on
the Cars.com Board of Directors. Ms. Greenthal will resign from the
TEGNA Board concurrently with the completion of the spin-off.
Cars.com Director Biographies
Scott Forbes
Scott Forbes, an experienced non-executive director, currently serves as
Chairman of two LSE-listed companies: Rightmove, the UK’s number one
online real estate company, and Ascential, an international business to
business media company. Scott is a member of the Board of Directors of
Travelport Limited and was previously Chairman of Orbitz Worldwide until
its sale to Expedia in September 2015. Scott has over 35 years of
experience in operations, finance and mergers and acquisitions,
including 15 years at Cendant, which was formerly a leading provider of
travel and real estate services. He established Cendant’s international
headquarters in London in 1999 and led this division as Group Managing
Director until he joined Rightmove in 2005.
T. Alex Vetter
T. Alex Vetter will serve as the President and Chief Executive Officer
of Cars.com. Alex has served as President and Chief Executive Officer of
Cars.com, LLC since 2014. As one of the original members of Cars.com
management, Alex has helped shape the company from its initial concept
into a leading digital automotive marketplace, steering the
organization’s growth strategy while serving in a variety of executive
roles spanning product development, customer service, training,
operations and sales, since the launch of Cars.com in 1998. From 2006
until his elevation to President and Chief Executive Officer in 2014,
Alex served in a variety of senior management roles for Cars.com LLC,
from Senior Vice President, Sales to Executive Vice President and Chief
Operating Officer. Alex is an active technology investor and advisor,
helping entrepreneurs and companies transition from seed or growth stage
with scale. He currently serves as a member of the Board of Directors of
RepairPal, and is on the advisory boards of several technology ventures,
including Shotfarm and Earshot.
Jill Greenthal
Jill Greenthal has been a Senior Advisor in the Private Equity Group of
The Blackstone Group, a global asset management firm. She previously was
a Senior Managing Director in Blackstone’s Advisory Group. Prior to
joining Blackstone, Jill was Co-Head of the Global Media Investment
Banking Group, a Member of the Executive Board of Investment Banking,
and Co-Head of the Boston office of Credit Suisse First Boston, an
Investment Bank. Jill currently serves on the Board of Directors of
TEGNA (from which she will resign when she joins the Board of Directors
of Cars.com), Akamai Technologies, Houghton Mifflin Harcourt, and The
Weather Channel. She previously served as a director of Michaels Stores
and Orbitz Worldwide.
Thomas Hale
Tom Hale is President of SurveyMonkey, the world’s largest online survey
company. Before joining SurveyMonkey, he was Chief Operating Officer of
HomeAway, an internet marketplace for vacation rentals. Prior to
HomeAway, Tom served as Linden Lab’s Chief Product Officer, where he
redesigned the consumer experience of Second Life. During his twelve
years at Macromedia and Adobe, he held several executive roles in
general management, product management, and marketing, most notably
building out each company’s developer and knowledge worker strategies.
Following the acquisition of Macromedia by Adobe, he was responsible for
the Acrobat family of products, including the revamped user experience
for Acrobat and integration of the real-time collaboration tool Adobe
Connect. Tom was previously a member of the Board of Directors of
ReachLocal, a public business to business digital marketing services
firm and of Intralinks, a public global technology provider of
enterprise content management solutions.
Donald A. McGovern, Jr.
Donald A. McGovern, Jr. has more than 40 years of financial and
accounting experience, retiring from PricewaterhouseCoopers (PwC) in
June 2013, following a 39-year career with the firm. During his time at
PwC, he was Vice Chairman, Global Assurance, directed the US firm's
services for several large public company clients and was involved in
over 30 Silicon Valley IPOs. He also held various other leadership roles
in PwC and was, from July 2001 to June 2008, a member of, and past lead
director for, the Board of Partners and Principals of the U.S. firm, as
well as a member of PwC’s Global Board. Don currently serves as Senior
Independent Director and Chair of the Remuneration Committee on the
Board of Directors of CRH, and a Director and Chair of the Audit
Committee of two private companies, Neuraltus Pharmaceuticals and eASIC
Corporation. He is a member of the American Institute of Certified
Public Accountants.
Greg Revelle
Greg Revelle is the Chief Marketing Officer for Kohl’s, responsible for
the marketing organization and overall marketing strategy, including the
company’s focus on driving customer engagement through analytics,
enhancing the loyalty platform, accelerating customer traffic and
continuing to build Kohl’s overall brand position. Prior to joining
Kohl’s, Greg was the Chief Marketing Officer at Best Buy, responsible
for marketing, customer strategy, brand positioning and execution across
all channels and customer touch points. He led efforts to redefine Best
Buy’s brand positioning and customer strategy, championed a shift to
digital and personalized customer communications, developed
sophisticated analytics capabilities and drove significant growth in the
company’s loyalty program. Prior to Best Buy, Greg served as Chief
Marketing Officer at AutoNation. Before that, he was Vice President of
worldwide online marketing at Expedia and an investment banker at Credit
Suisse.
Advisors
Greenhill & Co. is acting as financial advisor on the separation
transaction and Wachtell, Lipton, Rosen & Katz is acting as legal
advisor.
Forward Looking Statements
Any statements contained in this communication that do not describe
historical facts may constitute forward-looking statements as that term
is defined in the Private Securities Litigation Reform Act of 1995,
including statements with respect to the potential distribution of
TEGNA’s digital automotive marketplace business to its stockholders and
the expected financial results of the two companies after the
separation. Any forward-looking statements contained herein are based on
our management’s current beliefs and expectations, but are subject to a
number of risks, uncertainties and changes in circumstances, which may
cause actual results or company actions to differ materially from what
is expressed or implied by these statements. Such risks include, but are
not limited to: uncertainties as to the timing of the spin-off or
whether it will be completed, the possibility that various closing
conditions for the spin-off may not be satisfied or may be waived, the
expected tax treatment of the spin-off, the impact of the spin-off on
the businesses of TEGNA or Cars.com and the availability and terms of
financing. Economic, competitive, governmental, technological and other
factors and risks that may affect TEGNA’s operations or financial
results are discussed in TEGNA’s Annual Report on Form 10-K for the
fiscal year ended December 31, 2016, and in subsequent filings with the
U.S. Securities and Exchange Commission. TEGNA disclaims any obligation
to update these forward-looking statements other than as required by law.
About TEGNA
TEGNA Inc. (NYSE: TGNA) is comprised of a dynamic portfolio of media and
digital businesses that provide content that matters and brands that
deliver. TEGNA offers highly relevant, useful and smart content, when
and how people need it, to make the best decisions possible. TEGNA Media
includes 46 television stations and is the largest independent station
group of major network affiliates in the top 25 markets, reaching
approximately one-third of all television households nationwide. TEGNA
Digital is comprised of Cars.com, the leading online destination for
automotive consumers, CareerBuilder, a global leader in human capital
solutions, and G/O Digital, a customized local digital marketing
company. For more information, visit www.TEGNA.com.
About CARS.COM
Cars.com is a leading online destination that helps car shoppers and
owners navigate every turn of car ownership. A pioneer in automotive
classifieds, the company has evolved into one of the largest digital
automotive platforms, connecting consumers with local dealers across the
country anytime, anywhere. Through trusted expert content, on-the-lot
mobile app features, millions of new and used vehicle listings, a
comprehensive set of research tools and the largest database of consumer
reviews in the industry, Cars.com helps shoppers buy, sell and service
their vehicles. Cars.com companies include DealerRater®, Auto.com,
PickupTrucks.com™ and NewCars.com®. The company was founded in 1998 and
is headquartered in Chicago. For more information, visit www.Cars.com.
View source version on businesswire.com: http://www.businesswire.com/news/home/20170503006776/en/
Source: TEGNA Inc.
TENGA Inc.
For media inquiries, contact:
Steve Kidera
Manager,
Corporate Communications
703-873-6434
skidera@TEGNA.com
or
For
investor inquiries, contact:
Jeffrey Heinz
Vice President,
Investor Relations
703-873-6917
jheinz@TEGNA.com
or
Cars.com
Jandy
Tomy
Vice President of Investor Relations & Treasury
312-601-5115
jtomy@cars.com
