(Reuters) - Media General Inc said it would buy LIN Media LLC for $1.6 billion to create a broadcaster reaching nearly a quarter of U.S. households with a television.
LIN shareholders will get $27.82 per share in stock and cash, representing a premium of 29.5 percent to Lin's Thursday closing.
Media General shares jumped 12 percent, while those of LIN were trading at $28.20 before the bell on Friday.
Media General's Chairman Stewart Bryan said the deal would create the second-largest pure-play TV broadcasting company in the United States.
Bryan will remain chairman of the combined company, while LIN Media Chief Executive Vincent Sadusky will be the CEO.
RBC Capital Markets will provide $1.6 billion in financing to Media General, in which Warren Buffett's Berkshire Hathaway Inc held over 5 percent stake as of December.
Media General combined with privately held New Young Broadcasting Holding Co Inc last June.
The broadcasting industry saw a flurry of deals last year, with Gannett Co Inc buying Belo Corp for $1.5 billion, Tribune Co buying Local TV Holdings LLC for $2.7 billion and Sinclair Broadcast Group Inc buying eight TV stations from the Allbritton family for $985 million.
(Reporting by Sruthi Ramakrishnan in Bangalore; Editing by Sriraj Kalluvila and Saumyadeb Chakrabarty)