Cox TV Valued At $3.1 Billion In Apollo Acquisition

According to FCC filings, Terrier Media, a new company created by an Apollo private equity fund, will pay $3.1 billion for the Cox broadcast stations, but that number will be reduced by the value of the still unspecified amount of equity that Cox will retain in the stations. In the end, the Apollo fund will hold 77% of the Terrier equity, while Cox and Northwest Broadcasting, another station group Terrier is rolling up, will split the other 23%. Terrier will keep current Cox managment and be based in Atlanta.  

Terrier Media, a newly created company controlled by an Apollo Global Management private equity fund, will pay $3.1 billion to buy Cox Enterprises’ TV and radio stations, but that number will be “adjusted” by an unspecified minority stake that Cox will acquire in Terrier, according to FCC filings made public today.

Cox announced last month that it had sold control of the stations to Apollo without revealing any financial details.

At the same time, confirming a Reuters report, the filings say Terrier is purchasing the TV stations of Brian Brady’s Northwest Broadcasting, for $384 million, but that number too will be reduced as Northwest principals, like Cox, will acquire rollover equity in the new group.

The filings are vague on the ultimate shares that Cox and Northwest will have in Terrier. The Apollo fund will own 77% of the equity in it, they say, while the “majority” of the remaining 23% will be held by Cox. That means that Northwest will end up with a minority of the 23%.

Upon closing of the Cox and Northwest deals, Terrier will comprise 25 full-power TV stations covering 12.9% of U.S. households (without UHF discount) and 6.9% (with the UHF discount).

Respectful of the way Cox has been running its stations, the filings say, Terrier “intends to maintain Cox’s existing management and operations.” The new company will be headquartered in Atlanta, currently the home of Cox.

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“Combined, the merged company would have the first- or second-ranked station in over half of the company’s markets,” the filings say.

“Terrier Media, as a new entrant in the broadcast television market, will foster competition in the local markets and provide additional resources to improve service to the local communities without harming competition, diversity of voices, or content in any local television market.”

The filings say that Terrier is well under the 39% national ownership cap and does not see the need to divest any stations to comply with the FCC local ownership limits, pointing out that Cox and Northwest have no overlapping markets.

The filings acknowledge that Northwest and Cox have existing duopolies in several markets, including ones involving top-4 stations, but argue that Terrier should be allowed to keep them all intact.

Northwest’s top-4 duopoly in Yuma-El Centro, Ariz.,  has produced “undeniable” public interest benefits, the filings say. “Accordingly …, applying the Top Four prohibition under these circumstances is unwarranted and would disserve the public interest.”

Likewise, the filings say, Terrier intends to hang on to Cox’s top-4 combo in Jacksonville, Fla. Cox owns Fox affiliate WFOX and operates independently owned CBS affiliate WJAX through management contracts.

The filings point out that the FCC tacitly approved the Fox-CBS combo last year when it granted the transfer of WJAX from one former Cox executive to another.

With the backing of the Apollo fund, the filings say, Terrier will make the stations stronger and more competitive by providing capital for:

  • Capitalizing on the stations’ compelling local content by making that content available in multiple markets.
  • Improving the stations’ physical plant, including studio, back office and transmission equipment.
  • Growing each station’s digital presence in its local market through improvements in station websites and applications.
  • Deploying the resources required to promote deployment of ATSC 3.0.

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