HUNT VALLEY, MD. and ATLANTA – Sinclair has agreed to buy four TV stations from Cox Media Group for $94.7 million. Sinclair is purchasing KFOX-TV in El Paso, Texas; WJAC-TV in Johnstown, Penn.;
KRXI-TV in Reno, Nev.; and WTOV-TV in Steubenville, Ohio for $99 million less $4.3 million in working capital adjustments. Sinclair has also entered into an agreement to provide sales services to KAME-TV in Reno, which will be purchased by Deerfield Media. The five purchased stations reach 0.9 percent of U.S. TV Households. The transaction is subject to regulatory approval, though anticipated to close the second quarter of 2013. Sinclair expects the purchase, less a $5 million deposit, through bank loans and accessing capital markets.
the past 18 months, we have led the industry's consolidation efforts in the
mid-sized markets, purchasing 30 TV stations and creating over $400 million of
equity value,” said David Smith, president and CEO of Sinclair. “We believe
there are many more opportunities to acquire quality assets and to unlock
hidden value, including in the smaller markets, such as where the CMG stations
operate. We believe our platform size and leadership position allow us to
bring meaningful purchasing power and negotiating leverage to these
stations. Including synergies, we believe the CMG stations can generate
approximately $20 million of cash flow, on average.”
have established Chesapeake TV as the primary operating entity for the CMG
stations and other small market stations we may acquire, while STG will
continue to be our primary operating entity for mid-sized market
stations,” he said. “We believe a dual operating structure is critical to the
success of a small market strategy since the economics and competitive nature
can differ from those of the mid-sized markets.”
This news follows on the heels of Cox
Media Group’s Feb. 12 announcement that Connoisseur is buying its Southern
Connecticut radio stations and that SummitMedia is buying radio stations in
Birmingham, Ala.; Greenville, S.C.; Hawaii; Louisville, Ky.; and Richmond, Va.
All sales are expected to close during the second quarter following receipt of
regulatory approvals. Cox Media Group is working with Citi as financial advisor
and Dow Lohnes as transaction and regulatory counsel for all transactions.
Cox’s broadcast realignment, announced in July 2012, is part of the company’s
strategy to focus on larger markets, cross-media collaboration, and heightened
impact in fewer markets.
“All of these media
locations are valued brands with talented professionals who are committed to
their audiences, advertisers and communities,” said Cox Media Group President
Doug Franklin.“We wish all of the
employees well and know they will continue to work hard to produce quality
entertainment, news and information for their customers and new owners.”
As part of its broadcast realignment,
Cox recently added four new TV stations in two markets—Jacksonville, Fla. and
Tulsa, Okla.—to its broadcast group. The new stations—WAWS-TV (Fox) and WTEV-TV
(CBS) in Jacksonville and KOKI-TV (Fox) and KMYT-TV (MyNetwork) in Tulsa—will
provide opportunities for collaboration with Cox’s other businesses in those
markets.Cox owns and operates WAWS-TV,
KOKI-TV and KMYT-TV and provides operating services to WTEV-TV, which is owned
by Bayshore Television.