Nexstar to Buy ABC Affiliate for $18.5 Million, Sells Ex-Fox for $6.7 Million
August 9, 2011
IRVING, TEXAS and EVANSVILLE, IND.: Nexstar
is selling off its former Fox affiliate in Evansville and buying the ABC affiliate
there. Nexstar said it cut a deal with Gilmore Broadcasting to acquire WEHT-TV,
the ABC affiliate, for $18.5 million plus working capital adjustments
applicable at closing. It’s selling WTVW-TV, formerly a Fox affiliate, to
Mission Broadcasting for $6.7 million. Mission is Nexstar’s shared-services
partner in 15 stations, as it will be for WTVW when the deal is sealed.
Nexstar intends to borrow $11.8 million under its senior credit facility to finance
the WEHT purchase, net of the proceeds from the WTVW sale. The transactions are
subject to Federal Communications Commission approval and are expected to close
by year-end 2011.
The deal comes just shy of three weeks after Nexstar announced it had retained
advisors to explore a sale. The company owns and/or operates 65 TV stations,
notwithstanding the WEHT deal. Nexstar also is battling Fox over the network’s
demand for a piece of retransmission fees. The two are parting ways in
Evansville, Fort Wayne and Terre Haute, Ind., and in Springfield, Mo. Nexstar
has filed an antitrust lawsuit against Granite Broadcasting, which picked up
the Fox affiliation in Fort Wayne, giving it control of the ABC, Fox, NBC,
MyNetwork and CW affiliates there.
Perry Sook, president and CEO of Nexstar, said the purchase price for WEHT was
around four times average 2010-11 cash flow.
“Under Nexstar’s ownership, the station will realize additional retransmission
revenues as well as synergistic operating improvements, and on a pro-forma
basis the acquisition is both immediately accretive to results and de-leveraging
on a debt-to-cash-flow basis,” he said.
Nexstar today reported a 1.3 percent uptick in second-quarter revenues, to
$75.5 million, a record for the company. Retransmission revenues were up 18.4
percent to $8.6 million. Local comprised the largest portion, at $45.7 million.
National was $16.4 million. Nexstar reported total debt of $616.1 million,
versus cash of $12.5 million. Net loss for the quarter was $2.6 million or 9
cents a share, down from a net loss of $9.4 million or 33 cents a share a year
~ Deborah D. McAdams
See . . .
August 3, 2011: “The American Cable Association is sticking to its guns regarding Nexstar’s
antitrust lawsuit against Granite Broadcasting. The ACA contends the suit
demonstrates broadcasters collude on retransmission. ACA Says Nexstar’s
Granite Suit Demonstrates Retrans Collusion”
July 26, 2011:
Nexstar Sues Granite Over Fox Affiliation”
Nexstar Broadcasting is crying monopoly in one of the markets where it dropped
a Fox affiliation.
July 21, 2011:
““The company has not made a decision to pursue any specific strategic
transaction or other strategic alternative, and there is no set time table for
the process, so there can be no assurance that the exploration of strategic
alternatives will result in a sale of the company or any other transaction.” Nexstar Sale Trial
Balloon Boosts Shares”
comments powered by Disqus.