Additional proxy materials

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the

Securities Exchange Act of 1934

Filed by the Registrant x                            Filed by a Party other than the Registrant ¨

Check the appropriate box:

 

¨ Preliminary Proxy Statement

 

¨ Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))

 

¨ Definitive Proxy Statement

 

x Definitive Additional Materials

 

¨ Soliciting Material Pursuant to §240.14a-12

 

 

Media General, Inc.

 

(Name of Registrant as Specified In Its Charter)

 

 

  

 

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

 

Payment of Filing Fee (Check the appropriate box):

 

x No fee required.

 

¨ Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.

 

  (1) Title of each class of securities to which the transaction applies:

 

  

 
  (2) Aggregate number of securities to which the transaction applies:

 

  

 
  (3) Per unit price or other underlying value of the transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):

 

  

 
  (4) Proposed maximum aggregate value of the transaction:

 

  

 
  (5) Total fee paid:

 

  

 

 

¨ Fee paid previously with preliminary materials.

 

¨ Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.

 

  (1) Amount Previously Paid:

 

  

 
  (2) Form, Schedule or Registration Statement No.:

 

  

 
  (3) Filing Party:

 

  

 
  (4) Date Filed:

 

  

 

 


RiskMetrics
Group
ISS Governance Services
April 8, 2008
Rockville, Maryland


2
Company Overview
Headquartered in Richmond, Virginia
2007 Revenues –
just over $930 million
About 7,000 employees
Operations
25 daily newspapers
23 television stations
75+ portals, websites, Internet platforms


3
Mid-90s
changed and sharpened our
operating and geographic focus
An information company: platform is secondary
Southeast focus
Mission Statement:
“Our mission is to be the leading provider of high-
quality news, information and entertainment in the
Southeast by continually building on our position of
strength in strategically located markets.”
Evolution to:
a content company
focused on each particular market we serve
Our franchise is local content


4
An industry in transition:
Change often enabled by new technology
cable television
the Internet
Retaining fragmenting audiences requires that we
become increasingly platform indifferent
Lesson: the customer is in charge


5
Business plan elements
Quality local information
Audience aggregators
(but also audience segmenters
because of the
Internet)
Barriers to entry virtually eliminated
(but ease of entry also allows us to enter new 
markets with niche products, all with Internet
components, so that we can begin aggregating
desirable audience segments)
Retaining Internet audiences requires development of
a “sense of community”
User input on legacy sites
Blockdot; Boxerjam
DealTaker
(A lifelong bond with consumers)


6
Harbinger
July, 2007, 13G –
9.1%
(passive investor)
Immediately thereafter –
swaps, making total economic
interest 21.4%
(swaps undisclosed until December, 2007)
No contact from Harbinger
no calls before investment
repeated refusals to return calls after investment
Indefensible


7
Gabelli conference –
April 1, 2008
We heard, for the first time, Harbinger’s “prescription”
for Media General:
“Do better”
(clothed in B-school jargon)
but, a few specifics:
pursue duopolies
pursue retransmission consent fees
consider selling our Florida properties
sell DealTaker, Blockdot
(and another small stake
in an Internet company); and
pay down debt
also criticized our 2006 acquisition of four NBC
stations


8
Duopolies
FCC requirements
Allowed if:
8 full-power stations remain after the merger
Only one of the stations is in the Top 4 in the
market
Mostly a large-market strategy
some MEG markets are too small to allow
duopolies
depends on what stations/station groups become
available
MEG’s
Spartanburg tri-opoly
Alexandria (La.) virtual duopoly
use of digital bandwidth


9
Retransmission consent fees
(fees cable systems pay local television stations for
carrying their content)
Cable carriage is contract based (contracts generally
are 3-5 years)
Effect of increasing satellite and telephone
penetration (competitors to Cable)
Sinclair watershed
Actually, being actively pursued by MEG
All television owners know this
Hardly a new “prescription”


10
Selling our Florida properties
Gabelli
conference audience reaction
Harbinger retrenchment to “maybe just sell The
Tampa Tribune”
Worst possible time to sell a large-market newspaper
Low basis/tax leakage
Cannot be on-again/off-again presence in market


11
Selling DealTaker
and Blockdot
High-margin businesses
Role of “community”
as a differentiator on the Web


12
Pay down debt
(underway long before we knew Harbinger)
SP Newsprint
5 television stations being sold
Announced cost reductions/performance
improvements


13
2006 NBC Acquisition
Stockholder letter discussion
Gabelli
conference
Political revenue/broadcast margins in 2006 and,
now, 2008


14
What does this “prescription”
show about
Harbinger?
Short-term focus
Completely failed to understand MEG strategies
importance of serving good local markets
“leading provider”
requires long-term focus
Ideas do lead –
But, there isn’t a single good new idea in
Harbinger’s “prescription”
Harbinger’s frustration over its own poor market timing
does not translate to a claim that the MEG Board is
ineffective.


15
Harbinger’s nominees
Sullivan
skeptical of “$1 billion”
claim
character counts
Davis
13 public company boards already
RiskMetrics/ISS policy
Liebau
no relevant operating experience
no public company experience


16
Media General’s nominees
Charles A. Davis
Rodney A. Smolla
Walter E. Williams
Media General’s Board
varied relevant backgrounds
varied perspectives and ideas
varied lengths of service