Nov 24 (Reuters) - U.S. broadcaster Sinclair

has offered to buy E.W. Scripps in a cash-and-stock deal

that values its smaller rival at $538 million, as cord-cutting

and competition from streaming services lead to consolidation in

the media industry.

The bid, disclosed in a regulatory filing on Monday, follows

months of talks between the companies, as well as a regulatory

disclosure last week that Sinclair has an 8.2% stake in Scripps.

The $7-per-share offer for the remaining shares - consisting

of $2.72 cash and $4.28 in stock - represents a 70% premium to

Scripps' last close, Reuters calculations show.

Shares of Scripps rose 6.5%, while those of Sinclair fell

nearly 2%.

Sinclair has been looking to scale up as the U.S. media

industry struggles with declining traditional TV audiences, a

weak advertising environment and intensifying competition from

streaming giants like Netflix ( NFLX ).

Doubts emerged on Monday over rival broadcaster Nexstar's

$3.54 billion offer for Tegna, as U.S.

President Donald Trump criticized a proposal to lift the current

cap on local television station ownership, which is necessary

for the acquisition.

Sinclair said its deal for Scripps could close under current

ownership rules with limited divestitures of TV stations.

Scripps said its board will review the proposal. Descendants

of founder Edward Scripps control about 93% of the company's

common voting shares, according to the company's annual report.

The combined company would feature an independent board with

seats allocated based on ownership, include representation from

the Sinclair and Scripps families, and adopt joint editorial

standards overseen by an independent ombudsman, Sinclair said.

Upon the deal closing, Scripps' shareholders would own about

12.7% of the combined entity, Sinclair said.

The new, publicly traded company will retain Sinclair's

dual-class structure.