Discovery Communications said it signed a definitive agreement to buy Scripps Networks Interactive for $14.6 billion in cash and stock.
The price equals $90 a share, according to the companies—up 34% from where Scripps Networks was trading before sales rumors started on July 18. Viacom had also expressed interest in buying Scripps Networks, but bowed out of the bidding last week.
The move creates a larger programmer at a time when the industry is consolidating. But the new company still must operate in a challenging environment in which pay TV subscribers are falling and television advertising spending is growing slowly and facing strong competition from digital media.
Related: Analysts: Discovery-Scripps Merger Won’t Solve Problems
Neither company has links to a U.S. broadcaster or major domestic sports rights, so it will remain to be seen how much leverage the combined company will have with distributors.
“This is an exciting new chapter for Discovery," Discovery CEO David Zaslav said in a statement. "Scripps is one of the best run media companies in the world with terrific assets, strong brands and popular talent and formats. Our business is about great storytelling, authentic characters and passionate super fans. We believe that by coming together with Scripps, we will create a stronger, more flexible and more dynamic media company with a global content engine that can be fully optimized and monetized across our combined networks, products and services in every country around the world.”
Related: Discovery, Scripps Report Q2 Earnings
Discovery and Scripps will have nearly 20% share of ad-supported pay-TV audiences in the U.S., the companies said. Additionally, the combination will be home to five of the top pay-TV networks for women and will account for over 20% share of women watching primetime pay-TV in the U.S.