Gray To Acquire Two Stations for $128 Million

SJL Holdings to sell two ABC affiliates July 24, 2014
ATLANTA—Gray Television announced that it has agreed to acquire WJRT-TV and WTVG-TV from affiliates of SJL Holdings LLC for approximately $128.0 million in cash.

WJRT-TV and WTVG-TV are ABC-affiliated television stations serving the Flint-Saginaw-Bay City, Mich., and Toledo, Ohio, television markets, respectively. In addition, WTVG-TV will soon add a local CW station as a multicast channel. Nielsen ranks the Flint-Saginaw-Bay City at No. 68 and Toledo at 76.

Gray said WJRT-TV and WTVG-TV lead their local markets in all-day ratings and in most, if not all, local newscasts. According to BIA revenue data cited by Gray, WJRT-TV is the highest ranked television station in its market, and WTVG-TV is a close second ranked station in its market.

The transaction purchase price represents a multiple of approximately 7x a blended average of 2012-13 pro forma broadcast cash flow of the stations, including expected synergies. As such, Gray’:s acquisition of WJRT-TV and WTVG-TV will be immediately free cash flow accretive to Gray. Gray expects to finance the transaction with new term loans, cash on hand and/or by accessing the capital markets.

The transaction is subject to receipt of regulatory and other approvals and is expected to close in the third or fourth quarter of 2014.  Cooley LLP served as legal counsel for Gray. Proskauer served as legal counsel for SJL.

Upon completion of all pending transactions, Gray will own and/or operate television stations in 44 television markets broadcasting 142 program streams including 77 affiliates of the Big Four networks, reaching just over 8 percent of U.S. TV households.

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