Sinclair Broadcast Group buys 18 Barrington TV stations
Sinclair Broadcast Group announced Feb. 28 that it will buy the broadcast assets of 18 television stations owned by Barrington Broadcasting Group for $370 million and operate or provide sales services to another six stations.
The 24 stations are located in 15 markets and reach 3.4 percent of U.S. TV households. The deal, subject to FCC approval, is expected to close in the second quarter of the year. According to a Sinclair press announcement, the broadcaster anticipates financing the transaction with a bank loan or via the capital markets, less $20 million in deposits.
Three days prior to the announcement, Sinclair said it would buy four television stations owned by COX Media Group for $99 million, less $4.3 million of working capital adjustments and entered into an agreement to provide sales services to one other station. The Cox stations included KFOX (FOX) in El Paso, TX; WJAC (NBC) serving Johnstown/Altoona, PA; KRXI (FOX) and KAME (MNT) in Reno, NV; and WTOV (NBC) service Wheeling, WV/Steubenville, OH.
"This week, we launched our small-market television group when we announced we would be acquiring certain of the COX Media television stations," said David Smith, president and CEO of Sinclair. "The Barrington stations are an important part of that strategy, providing meaningful scale to the group."
Sinclair anticipates the Barrington stations can produce about $71 million in cash flow, on average. "When combined with the COX stations, we expect our expertise and resources to create approximately $29 million in synergistic, incremental cash flow, equating to approximately $232 million of added equity value or $2.85 per share."
Steve Pruett will join Sinclair’s management team as COO of Chesapeake TV, SBG’s new small TV station entity. Pruett has more than 30 years of experience in the broadcast industry.
To avoid conflicts with FCC ownership rules, Sinclair said it will sell WSYT (FOX) in Syracuse, NY, and assign its local marketing agreement (LMA) and purchase option on WNYS (MNT) in Syracuse. The company will also sell WYZZ (FOX) in Peoria, IL. In addition, the license assets of four stations will be purchased by Cunningham Broadcasting and Howard Stirk Holdings.