Hawaii Newsroom Merger Assessed as a Sale

Raycom to pay $22 million for station operations
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HONOLULU: The controversial newsroom merger among three Hawaiian television stations is drawing more fire with the revelation that more than $22 million could change hands. Under a proposed shared services agreement,KGMB-TV, KHNL-TV and KFVE-TV would combine the stations’ newsrooms. KGMB is the CBS affiliate in Hawaii owned by MGC Capital Corp. in Arlington, Va.; Raycom Media of Montgomery, Ala., owns KHNL and KFVE, the NBC and MyNetworkTV affiliates, respectively.

The Honolulu Advertiser reports that Securities and Exchange Commission filings indicate that Raycom would pay MCG $22 million over seven years under SSA terms. A local activist group, Media Council Hawai‘i, considers the deal a violation of federal media ownership rules.
“This is media consolidation at its worst,” Media Council chief Chris Conybeare told the Advertiser. “They are trying to hide what they are doing from the public.”

Raycom chief Paul McTear previously said the merger was an economic necessity if all three stations were to continue to stay in business.

More on the proposed agreement:
September 16, 2009: “Opposition Mounts over Hawaii TV Operational Merger”
“Media Council Hawai‘i--formerly the Honolulu Community-Media Council--will challenge the illegal Raycom Media deal involving Stations KHNL, KGMB, and KFVE at the FCC,” the group said in a statement released Sept. 4.