Stingray Digital to acquire Newcap Radio owner

Stingray Digital Group Inc. is set to acquire Newfoundland Capital Corp. in a cash-and-stock deal valued at $508-million.

Newfoundland Capital, which owns and operates broadcaster Newcap Radio, says it has signed a definitive agreement with Stingray, which would acquire all of its issued and outstanding shares.

The Montreal-based music and digital experience provider will pay $14.75 per share, payable in a combination of cash and Stingray shares.

Newfoundland Capital says the transaction is valued at approximately $508 million, including the assumption of net debt of roughly $112 million as of Dec. 31.

The transaction will be subject to approval of shareholders, customary closing conditions and regulatory approvals.

Stingray’s chief executive and president Eric Boyko says the transaction positions the company as a “major player in the Canadian media landscape.”

“I am excited to expand Stingray’s operations into radio broadcasting and bring on board some of Canada’s most popular on-air talent and an experienced sales force, which will help us grow our revenue streams,” Boyko said.

Newfoundland Capital “reaches millions of listeners each week through a variety of formats and is a recognized industry leader in radio programming, sales, and networking,” Stingray said.

“NCC operates 72 local radio stations and 29 repeating stations — also available on web and mobile — in seven provinces from coast to coast. NCC holds the secondlargest number of radio licences in Canada.”

Based in Dartmouth, Nova Scotia, NCC employs approximately 800 people.

“Today marks the start of an exciting chapter for NCC,” said Rob Steele, who is chairman, president and chief executive officer of NCC.

“By joining forces with Stingray, we are of the view that the synergies will allow our business to move towards even greater success.”

NCC shares traded at $13.20 on Wednesday.