A proposed $8.5 billion merger of two of the nation’s largest local television companies would gather TV stations in Denver, Colorado Springs and Grand Junction under one corporate roof.

Atlanta-based Gray Television, which operates KKTV in the Springs and KKCO serving Grand Junction, is seeking to acquire Tegna, the Tysons, Virginia, owner of KUSA in Denver and its sister signal KTVD. Gray has offered a bid of about $20 a share in cash and stock for Tenga.

The companies also operate their stations’ affiliated websites.

Reuters, citing unidentified “people familiar with the matter,” said Tegna hasn’t yet accepted Gray’s offer, nor has it indicated it would agree to the buyout bid.

Tegna is the larger of the two broadcast companies, with market capitalization of $2.9 billion to Gray’s $1.6 billion.

The news service said Gray already is carrying some $3.8 billion in debt, with Tegna’s debt load at $4.2 billion. But Reuters quotes a source as saying that Gray “has a plan to quickly pay down debt should the deal be completed.”

In some past media-company mergers involving significant debt, the combinations have been followed by cost-cutting moves, including layoffs.

Gray has made no public announcement of the reported offer and did not respond to Reuters’ request for comment. Tegna declined to comment.

Mark Cornetta, president and general manager of Tegna’s two Denver stations and a Tegna corporate official, declined to comment to The Gazette on the reports of a proposed deal.

At KKTV, Kerri Blanco, director of sales, said the station had no comment.

It’s not immediately clear what impact such a deal, if it happens, would have on the current news-sharing partnerships among the stations involved.

Denver’s KUSA currently has a relationship with KRDO in Colorado Springs, a KKTV competitor, while KKTV has been partnering with Denver station KCNC .

KKTV also is a news partner of The Gazette, and KUSA is a partner of Colorado Politics.

Gray and Tegna each operate in dozens of markets coast to coast, with Tegna focused on larger cities and Gray mostly on smaller ones.

Tegna says it runs 62 TV stations in 51 U.S. markets. Gray says it operates in 93 markets. The shares of U.S. TV homes served by their stations are 39% and 24%, respectively.

Gray also operates stations in Cheyenne and Casper, Wyoming.

The two companies on Feb. 26 announced a deal under which Gray would acquire a minority ownership interest in Premion, Tegna’s “over the top” streaming advertising platform. Under the deal, Gray will serve as a reseller of Premion’s services across its 93 markets.

The proposed buyout would be the latest in a series of consolidations in the U.S. broadcast sector, which is beset by declining viewership for traditional TV broadcasts.

Tegna formerly was part of Gannett , which merged in 2019 with GateHouse Media. Gannett is one of the nation’s largest publishers of newspapers, including USA Today and The Coloradoan of Fort Collins.

Shares of Tegna stock, which closed at $13.44 Thursday, rose sharply Friday on news of the proposed deal and finished at $17 – an increase of 26.5% Meanwhile, Gray’s shares fell 4.4% to $15.06.