CBS exchanges $170 million plus WFRV Green Bay/WJMN Escanaba for Liberty’s 7.6 million CBS shares.
CBS Corp. and Liberty Media Corp. announced today that they have entered into a definitive agreement whereby Liberty will exchange its 7,591,249 CBS common shares for CBS’s WFRV Green Bay, Wis. (DMA 69) and its satellite WJMN Escanaba, Mich. (valued at $64 million) plus approximately $170 million cash in a tax-free deal. The price at which Liberty will exchange its CBS shares will be set upon closing.
This deal follows last week’s announcement that CBS is selling seven stations in four markets— Austin, Texas; Salt Lake City; Providence, R.I.; and West Palm Beach, Fla.—to a private equity fund for $185 million.
Bear Stearns commented on this deal, saying: “Today’s announcement is consistent with CBS’s recent strategy of divesting smaller market TV and radio stations to focus management attention on larger markets. With the sale of WFRV, CBS will be left with only one TV station in a DMA below No. 25, its CW affiliate WGNT in Norfolk, Va., DMA 42. We would not be surprised if CBS sold this station as well in the coming months and believe that it will continue to explore the sale of other smaller radio and TV stations, especially as sale multiples have been well above where the company trades.”
The transaction, unanimously approved by the boards of CBS Corp. and Liberty Media, is expected to be completed in the second quarter of 2007, and is subject to FCC approval and other customary closing conditions.