Media General, LIN Sell Stations In 5 Markets

The two companies say the deals should satisfy regulatory requirements related to their pending merger. As part of the arrangements, Media General is buying two stations in Colorado Springs and one in Tampa from Sinclair Broadcast Group.
By
TVNewsCheck,

Media General Inc. and LIN Media today agreed to sell or swap television stations in five markets to comply with FCC ownership rules affecting the merger they announced on March 21. Media General also announced today that in light of the loss of CBS affiliation of LIN’s WISH Indianapolis, it was lowering the per-share price of the deal from $27.82 to $25.97.

Regulatory authorities are requiring the divestiture of stations in the following markets: Birmingham, Ala.; Providence, R.I.-New Bedford, Mass.; Mobile, Ala.-Pensacola, Fla.; Green Bay-Appleton, Wis.; and Savannah, Ga. The companies said they believe that no other market divestitures will be required.

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Media General and LIN are swapping stations with Sinclair Broadcast Group

Sinclair picks up Media General’s NBC affiliate in Providence-New Bedford (DMA 53), WJAR, and LIN’s Fox and CW affiliates in Green Bay-Appleton (DMA 71), WLUK and WCWF, respectively. In addition, Sinclair will also acquire WTGS, the Fox affiliate in Savannah (DMA 92), from LIN-backed WTGS Television. LIN has been operating WTGS under a shared services agreeement.

In exchange, Media General will acquire Sinclair’s Fox and CW affiliates in Colorado Springs-Pueblo, Colo. (DMA 89) — KXRM and KXTU, respectively — and Sinclair’s MyNetworkTV affiliate in Tampa-St. Petersburg-Sarasota, Fla. (DMA 14), WTTA.

As part of the transaction, Sinclair will pay $31 million for an additional $3.4 million of cash flow being swapped.

Brand Connections

Meanwhile, Hearst Corp. will acquire Media General’s NBC affiliate in Birmingham (DMA 45), WVTM, and LIN’s ABC affiliate in Savannah (DMA 92), WJCL. The price of that deal was not disclosed.

And Meredith Corp. will acquire LIN’s Fox affiliate in the Mobile-Pensacola WALA for approximately $86 million, according to Meredith.

“We’re pleased to announce this divestiture plan, which we believe should clear the way for our business combination with LIN Media to move forward in the regulatory approval process,” said George L. Mahoney, president-CEO of Media General. “Additionally, the purchase of the MyNetworkTV station in Tampa provides us with the opportunity to increase share in Media General’s second largest market. Also, the addition of the Fox and CW affiliates in Colorado Springs marks the first time we will have a television station in Colorado.

“The stations being divested are strong performers. We are proud of the work that they have done, and we wish the employees at these stations all the best as they transition to new ownership,” Mahoney added.

Vincent L. Sadusky, president-CEO of LIN Media, said: “The divestiture plan is an important milestone that positions us well with regulatory authorities. We are pleased with the consideration we will receive for these terrific stations and plan to use the net proceeds to reduce debt. The addition of stations in Tampa and Colorado Springs will further diversify and strengthen the combined company’s portfolio as well as provide opportunities to expand our digital business. I am more confident than ever that the combination of Media General and LIN Media, two highly respected broadcasters with superior television and digital assets, creates maximum value for shareholders.”

Sadusky will become the president-CEO of the combined company following the completion of the merger.

Media General said it will structure the transactions, along with its previously announced purchase of WHTM Harrisburg, Pa., to maximize tax efficiencies.

The stations to be acquired, including WHTM, have a combined broadcast cash flow of approximately $21 million, based on 2013-14 averages. The stations to be divested have a combined broadcast cash flow of approximately $37 million, based on 2013-14 averages. Gross proceeds for all stations to be divested will be approximately $360 million.

The aggregate purchase price for the stations to be acquired, including WHTM, will be approximately $177 million. Net proceeds, after taxes and expenses, are expected to be in the range of $140 million to $160 million and will be used to reduce Media General’s debt after the closing of the merger.

The divestitures and acquisitions are contingent upon regulatory and other customary approvals and upon the completion of the transaction, except for Media General’s previously announced purchase of WHTM, which is expected to close in the third quarter of 2014. Media General and LIN Media continue to expect that the business combination will be completed in early 2015.

Sinclair CEO David Smith said that the swaps with Media General and LIN benefit Sinclair in multiple ways.

“This transaction not only allows us to strengthen our portfolio geographically, but because it frees up 0.7% of national ownership cap, it allows us the ability to acquire additional television stations that are core to our asset base,” said David Smith, President and CEO of Sinclair. “The Green Bay stations complete our coverage of all the major cities in Wisconsin, an important political swing state. The NBC affiliate in Providence is the No. 1 station in the market and provides us another state capital presence, while the Savannah station strengthens our existing presence in Georgia and the Southeast.

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Comments (12) -

Ted Hearn Nickname posted over 2 years ago
Broadcasting's biggest problem isn't the free-market, consumer-friendly Rockefeller-Thune Local Choice proposal, which is a Fort Know windfall for local TV stations .............. No, the real and growing problem is Air Marshal Moonves at CBS: "CBS Sending Big Message To Affiliates" .............. .By John Sewarda/Benzinga .......... CBS is sending a message to its affiliates: Pay up or get out. CBS Chief Executive Leslie Moonves signaled that the company was seeking higher fees in a conference call with analysts last week. "We decide what we think is fair," said Moonves.................... Please follow me on Twitter @TedatACA
James Cieloha Nickname posted over 2 years ago
I agree, but likely it could pave the way for the possibly for David Smith-Barry Faber-David Amy's Sinclair Broadcast group to fully come to Providence for WLNE to place WLNE's ABC programming on WJAR .2 digital subchannel due to the possibly of Philip Lombardo getting tired of owning WLNE and Lincoln for KLKN from Philip Lombardo's Citadel and even to Des Moines for KDMI to put KDMI MYNET/This TV programming on the .3 and KCWI to put KCWI CW programming on the .2 on KDSM digital subchannels in addition to carry FOX prgramming on KDSM main channel plus NTV(KHGI-KWNB) in Kearney and KFXL over the air signal in Lincoln as a way to combine NTV and KLKN altogether with KLKN in Lincoln airing KLKN ABC signal on .1 with NTV on .2 while KHGI/KWNB in Kearney airing NTV signal on .1 with KLKN on .2 meaning KLKN stays with ABC and NTV switches to FOX by folding the best of the syndicated programming and the FOX affiliation from KFXL FOX Nebraska from Harry Pappas nameshake company Pappas Telecasting that has been currently under receivership by Pappas bankruptcy liquidation trustee David Stapleton. Providence and Lincoln are targets for Sinclair to acquire TV stations due to Philip Lombardo possibly wanting to hand up and retire for good and Harry Pappas to finally not having to deal with a TV station in Nebraska for Sinclair to reunite NTV and KFXL plus combining KLKN in Nebraska with KCWI and KDMI in Des Moines, Iowa with KPTM and KXVO in Omaha and KPTH and KMEG in Sioux City.
Insider Nickname posted over 2 years ago
You really must be upset that Media General/Lin did all these swaps/sells - and NONE of them was what you suggested, ROFLMAO. Shows your insight!
Insider Nickname posted over 2 years ago
Actually, the only Company that should be fearful is Dispatch in Indianapolis as they only have 2 stations and 1 NBC affiliate - in Indy. You can bet the farm that Media General will end up with that NBC Affiliation to add to their others in the future.
TVmaker Nickname posted over 2 years ago
Careful here, you'll get James wound up with another senseless run-on paragraph that starts off with Dispatch and ends somewhere that is not even remotely associated with anything related to Dispatch, NBC, Indianapolis, or maybe even TV in general.
Insider Nickname posted over 2 years ago
good point
FreeRightsUSA Nickname posted over 2 years ago
Worst case scenario for WJAR. Why get rid of the Number 1 station in the market? Since MG ownership, the station has gone down hill in terms of news product, too many unprofessional reporters plus hardly any coverage on weekends (WJAR had to depend on NBC reports for the circus accident that happened in their own market - that speaks volume). Sinclair will value operate the station as they do elsewhere, and the news product will have to reflect the Smith family views and electioneering(Swift Boat anyone?). Not to mention in several markets, larger than Providence, they dont' even broadcast any news. My condolences for the heritage employees of WJAR. What a drop off the cliff from NBC ownership. Too bad Meredith or Hearst didn't pick them up, or Scripps or any other group with better reputation than Sincrap. It boggles the mind the FCC allows them to continue to buy more stations.
steve - posted over 2 years ago
i think i've seen it all now @ tvnewscheck- the grammarian meets the grammar killer.
Ted Hearn Nickname posted over 2 years ago
Hey, Media General (MEG), do $LIN shareholders get another “window-shop” opportunity to seek a better offer than the 6% haircut you handed out today? Didn't think so ............................ Please follow me on Twitter @TedatACA
Insider Nickname posted over 2 years ago
This is interesting Ted. You are pushing for Media General to pay full price for something that is not worth what it was when the deal was announced. Isn't it interesting that the ACA Loudmouth wants people to over pay for something that is not worth what it once was!!!!!!!!!!!!!!!!!! Please follow me on Twitter @ NotTedatACA
cowboy Nickname posted over 2 years ago
Ted Hearn is completely off base. The only way the Rockefeller Thune proposal makes any sense is if it's ala carte for all channels. Maybe purple haired ladies can at long last be free from having to subscribe to ESPN at $12/month to get the Church channel. The MVPD's should be ashamed of themselves for robbing Americans of REAL choice.
Insider Nickname posted over 2 years ago
Ted off base? The only time Ted is off base is when it is AM or PM.
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Ratings

Overnights, adults 18-49 for September 25, 2016
  • 1.
    5.5/18
  • 2.
    2.6/8
  • 3.
    1.2/4
  • 4.
    0.9/3
  • 5.
    0.5/2
  • 6.
    0.2/1
Source: Nielsen

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