The station group is paying $18 million for the CW affiliate in Jacksonville, Fla., but, because the cash-flow multiple is low, it believes the acquisition will help in deleveraging the publicly traded company.
FCC today granted Nexstar Broadcasting Group’s $18 million purchase of WCWJ Jacksonville, Fla. (DMA 47) from Media General.
When Nexstar announced the deal in January, it said that the price was “less than five times 2009 projected cash flow.”
If that’s the case, the CW affiliate’s projected 2009 cash flow is less than $3.6 million.
Because of the low cash-flow multiple, Nexstar CEO Perry Sook said, the deal will actually help in “deleveraging” the publicly traded company’s balance sheet.
Like many other leveraged TV station groups, Nexstar is in danger of defaulting on loan agreements because of falling cash flows and rising debt ratios.
Nexstar is a major duopoly player, but WCWJ will be its only station in the Jacksonville market.