Sinclair Spins Off 23 TVs To Grease Trib Deal

McDermottKimTo win approval of FCC and DOJ regulators for its Tribune merger, Sinclair on Tuesday announced deals to sell 23 Tribune stations in 18 markets. Nine stations will go to Standard Media, a new group backed by Soohyung Kim and headed by Deb McDermott, for $442 million, while Meredith is getting KPLR St. Louis for $65 million. Sinclair is selling six to affiliated companies and will operate them under SSAs and JSAs. Sinclair did not name the buyer of the other seven, including six Fox affliates, but all eyes are on Fox.

Standard Media Group, a new broadcast company backed by hedge fund Standard General, has agreed to buy nine stations in seven markets that Sinclair is spinning off from its merger with Tribune, it was announced by the parties Tuesday afternoon. The price: $441.7 million.

Standard General, headed by Soohyung Kim, held controlling interest in Media General at the time of its sale to Nexstar early last year. Deb McDermott, who was COO of Media General under Kim, is the CEO of the newly formed Standard Media Group.

Sinclair also announced a number of deals involving 14 other stations. Along with the Standard Media deal, at least half are intended to bring Sinclair’s $3.9 billion merger with Tribune into compliance with FCC ownership rules and Justice Department antitrust regulators.

It is selling Tribune’s KPLR, a CW affiliate in St. Louis, to Meredith for $65 million.

It is spinning off six stations to affiliated companies, but will continue to operate them under joint sales and shared services agreements. They are:

  • Tribune’s WGN Chicago (Ind.) to WGN-TV LLC
  • Tribune’s KDAF Dallas (CW) to Cunningham
  • Tribune’s KIAH (CW) to Cunningham
  • Sinclair’s KUNS Seattle (Univision) to Armstrong Williams
  • Sinclair’s KMYU Salt Lake City (MNT) to Armstrong Williams
  • Tribune’s KAUT Oklahoma City (Ind.) to Armstrong Williams

And it is selling Tribune’s Fox affiliates in six markets —KCPQ Seattle, KDVR Denver, WJW Cleveland, KTXL Sacramento, KWSB San Diego and KSTU Salt Lake City — and Tribune’s CW affiliate in Miami, WSFL, to an unnamed party or parties.

BRAND CONNECTIONS

According to industry sources, Fox has been negotiating to buy stations from Sinclair and is the likely buyer of most, if not all, of the seven. A Fox spokesman declined comment.

McDermott said in a prepared statement that the stations her group is picking up have great potential.

“Following this transaction, Standard Media will be well positioned to make further accretive acquisitions and we believe there is a compelling market opportunity to create another large player in the consolidating broadcast TV industry.”

The nine stations Standard is buying:

  • Sinclair’s KOKH Oklahoma City (Fox)
  • Tribune’s WXMI Grand Rapids, Mich. (Fox)
  • Tribune’s WPMT Harrisburg, Pa. (Fox)
  • Sinclair’s WXLV Greensboro, N.C. (ABC)
  • Sinclair’s WRLH Richmond, Va. (Fox)
  • Sinclair’s KDSM Des Moines, Iowa (Fox)
  • Sinclair’s WOLF-WSWB-WQMY Wilkes Barre-Scranton, Pa (Fox-CW-MNT)

Shortly after Sinclair’s press release on its FCC filing went out this afternoon, Tribune CEO Peter Kern sent an email to all Tribune Media employees.

In it, he said: “We’ve known for nearly a year that change was coming, but as I’ve said before, there is no reason to assume that this change won’t be for the better. Whether your parent company is Sinclair or any of the other media companies identified in today’s filing, you are the key ingredient to their ultimate success. Each of them will have their own unique opportunities and challenges, but each needs talented, experienced and dedicated employees like you.

“So, try to focus, as you have always done, on the business at hand — delivering outstanding local journalism and great content for our audiences and communities, collaborating with your colleagues, and driving results for our customers.”

Meredith President-CEO Tom Harty said the acquisition of KPLR is “consistent with our successful ‘Total Shareholder Return’ strategy and will be immediately accretive to earnings.”

Meredith will fund the acquisition using existing cash, the company said.


Comments (25)

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Megatron81 says:

April 24, 2018 at 6:46 pm

I really thought that Meredith would have bought WXMI Fox17 didn’t think a new player would have bought Fox17 Standard Media just glad it isn’t no sidecar. As I said thought Sinclair was going to sell WXMI over WWMT.

mrfixit says:

April 24, 2018 at 7:15 pm

WGN to WGN llc.?????? lol, what the heck is that? wow! let’s get some information on that! didn’t think that would slip passed us did they??? who are the key players in WGN llc????? Also interesting that the Tribune station in St. Louis is selling at 4X the value that Tribune’s most valuable asset, WPIX was priced for at $15 Million. I hope all Govt. agencies that are investigating this see Red Flags, FCC, FTC,DOJ etc. etc.

KaiSen says:

April 24, 2018 at 7:59 pm

What is Sinclair going to do about WTKR/WGNT (Tribune "managed") and WTVZ (Sinclair-owned) in the Hampton Roads/Tidewater/Coastal Virginia region? Armstrong Williams originally had WGNT as one of their picks, but most of them are now going to be bought by Standard. Ownership in three channels in the Norfolk, VA market still seems problematic to me, and they’re still ignoring it.

    EricPost says:

    April 24, 2018 at 11:02 pm

    I wondered about the low prices. Way back WPWR was sold to FOX for 455 million. Are TV stations really that lowly now? You would think CBS would want WGN in Chicago if nothing more than it’s UHF signal. CBS still has a lot of problems being stuck on VHF in Chicago and having to lease low power stations to fill in gaps which still doesn’t work well.

newsoldie says:

April 24, 2018 at 8:23 pm

Hello… it’s KPLR, not WPLR. Please have a television person write about television.

tvn-member-3112458 says:

April 24, 2018 at 8:28 pm

No reason to get nasty. I fixed it.

OldSchool says:

April 24, 2018 at 8:55 pm

It is not you Harry…. Any topic on Sinclair is fuel for the fire…

FormerOwner says:

April 24, 2018 at 10:57 pm

Tribune bought KPLR in 2002 from ACME for $ 200 million and now they sell it for $ 65 million. WOW what a haircut!

mrfixit says:

April 25, 2018 at 7:26 am

was that BIA/Kelsey just released study that TV Revenue will drop 45% by 2025? lol, got to laugh about all the reasons this is a bad move and bad move for Shareholders. Brick & Mortar TV is Dying fast – like I need a local TV Station when I can watch whatever I want from a website on the Internet. I hope this goes through, I have no financial interest in this, just an ethical one.Sinclair is basically making a fair trade at this point and may wind up with the same viewership it started with.

2018bstyrevr says:

April 25, 2018 at 7:37 am

The broadcast business is getting worse every day…..Deb is a very nice person and she navigated somewhat through the Young debacle..but this is not good..Tv is a complete commodity business and this proves it..there is no value here..Also why did Gray and Nexstar not step up???other???.Because except for the O and O’s( who have networks behind them)… 90 % of all broadcasters are over-leveraged and in big trouble!!

FormerOwner says:

April 25, 2018 at 8:24 am

Standard paid almost the same price $62 million per market as Meredith did for KPLR. I bet Deb did not put any of her money in that deal. Way over priced for stand alone mid market FOX stations.

Sammy says:

April 25, 2018 at 8:31 am

Well, it looks like the writing is now officially on the wall for Sunbeam in Miami.

mrfixit says:

April 25, 2018 at 8:35 am

The FCC should require Sinclair to get rid of all the Tribune and Sinclair sidecar deals before anything else. The sidecar deals, I’m sure are or should be under investigation by the FCC Inspector General among a host of other bizarre moves the FCC allowed.

    FlashFlood says:

    April 25, 2018 at 2:29 pm

    Really? I think that Sunbeam is doing better in Miami than in Boston.

HopeUMakeit says:

April 25, 2018 at 9:01 am

SO once this deal is completed 3 black Americans will own a TV station in this country. ?

    TVMN says:

    April 25, 2018 at 9:30 am

    With Ajit Pai at the helm, that won’t happen. He’s a Sinclair toadie. He’s actively trying to get regulations changed to benefit them. I agree that Sinclair’s use of shell corporations to slip past regulations is wrong.

HopeUMakeit says:

April 25, 2018 at 9:17 am

notice that DMA #’s 4 Dallas and 5 Houston are going in side cars to get those big markets off the spread sheet.

veteranmanager says:

April 25, 2018 at 10:24 am

Just ask some former Media General Corporate about Kim and Deb. Both are examples of the Peter Principle at the highest level.

OldSchool says:

April 25, 2018 at 2:37 pm

Most people in the business know the talent, knowledge and skill set (or lack of) with Deb and Kim, However Kim still has the money and Deb is leading his company. Standard wants to be a player in further acquisitions so they will need some talent and skill set to be a player and profitable.

2018bstyrevr says:

April 25, 2018 at 6:58 pm

There are a bunch of C- students…Like Deb…working for Nexstar in Regional management positions and GM positions that used to run Young–Media General Stations..Prime candidates for Deb…

newsbot says:

April 25, 2018 at 8:13 pm

"Grease?" I know you hate Sinclair, Harry, but even this is beyond the pale.

tvn-member-4730298 says:

April 26, 2018 at 8:44 am

Sinclair is driving ATSC 3 so this is interesting to see how they will land. Their model involves subscription services which is the new way your local station will monetize content. I’m recording as much as I can right now because I can see a day ahead with pay OTA tv. And our Tribune stations have had an interesting run. Tribune remodeled our NBC affiliate and spent a chunk of change then turned around and built a whole new station and tore the old one down. Nothing like tossing money into a pile and then burning it.


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