The 24 stations in 15 markets cover 3.4% of the U.S. and range from DMAs 67 to 103. Steven Pruett to be named chief operating officer of Sinclair’s Chesapeake TV subsidiary, overseeing its small-market strategy.
Sinclair Broadcast Group announced Thursday that it is purchasing 18 TV stations from Barrington Broadcasting Group for $370 million and entering into agreements to operate or provide sales services to another six stations.
The 24 stations are located in 15 markets and reach 3.4% of the U.S. TV households. The transaction is subject to approval by the FCC and antitrust clearance. Sinclair said it anticipates the transaction will close and fund in the second quarter of 2013. It said it expects to finance the purchase price, less $20 million in deposits, through a bank loan and/or by accessing the capital markets.
The Barrington stations covered by the transaction are:
WEYI NBC Flint/Saginaw/Bay City/Midland, MI DMA 67
WBSF CW Flint/Saginaw/Bay City/Midland, MI 67
WNWO NBC Toledo, OH 76
WACH FOX Columbia, SC 77
WSTM NBC Syracuse, NY 84
WTVH CBS Syracuse, NY 84
WSTQ CW Syracuse, NY 84
KGBT CBS Harlingen/Weslaco/Brownsville/McAllen, TX 86
KXRM FOX Colorado Springs, CO 89
KXTU CW Colorado Springs, CO 89
WPDE ABC Myrtle Beach/Florence, SC 103
WWMB CW Myrtle Beach/Florence, SC 103
WHOI ABC Peoria/Bloomington, IL 116
WPBN NBC Traverse City/Cadillac, MI 120
WGTU ABC Traverse City/Cadillac, MI 120
WTOM NBC Traverse City/Cadillac, MI 120
WGTQ ABC Traverse City/Cadillac, MI 120
KVII ABC Amarillo, TX 130
KVIH ABC Amarillo, TX 130
KRCG CBS Columbia/Jefferson City, MO 138
WFXL FOX Albany, GA 150
KHQA CBS Quincy, IL/Hannibal, MO/Keokuk, IA 171
WLUC NBC Marquette, MI 180
KTVO ABC Ottumwa, IA/Kirksville, MO 199
Due to FCC ownership conflict rules, Sinclair will sell its station in Syracuse, N.Y., WSYT (Fox), and assign its local marketing agreement (LMA) and purchase option on WNYS (MNT) Syracuse. The company will also sell its station in Peoria, IL, WYZZ (Fox).
In addition, the license assets of four stations will be purchased by Cunningham Broadcasting Corp. and Howard Stirk Holdings, a newly formed entity owned and controlled by Armstrong Williams, founder and CEO of boutique communications firm, The Graham Williams Group.
In addition to his work as a political commentator, Williams has spent nearly 20 years developing and producing television programming, including primetime specials with U.S. Supreme Court Justice Clarence Thomas, former Vice President Dick Cheney and Israeli Prime Minister Benjamin Netanyahu. From 2001 to 2003, Williams was COO of the Renaissance Cable TV Network with responsibility for all programming, advertising and content development.
“We are pleased to advance the diversity efforts of the FCC and create a path for minority ownership in the broadcast space through Howard Stirk Holdings,” said David Smith, Sinclair president-CEO.
“This week, we launched our small market television group when we announced we would be acquiring certain of the Cox Media television stations,” Smith continued. “The Barrington stations are an important part of that strategy, providing meaningful scale to the group. Including synergies, we believe the Barrington stations can generate approximately $71 million of cash flow, on average. When combined with the Cox stations, we expect our expertise and resources to create approximately $29.0 million in synergistic, incremental cash flow, equating to approximately $232.0 million of added equity value or $2.85 per share.
“We are pleased to announce that Steve Pruett will be joining our senior management team as COO of Chesapeake TV. Steve brings many years of media experience, most recently as CEO of Communications Corp. of America’s 25 television station group. Steve will oversee the growth and development of our small market strategy, while Steve Marks will continue as COO of Sinclair Television Group, overseeing our mid-sized market strategy.”
Pruett said: “The competitive environment for local affiliate television is changing rapidly. Chesapeake TV represents a tremendous opportunity to build scale and efficiency and to strengthen competitive positioning in small markets by applying Sinclair s resources, discipline and management systems, which in my observation are world class. Our vision is big, and with the backing of Sinclair, we have what it takes to execute it.”
Pruett has more than 30 years of experience in the broadcast industry with an extensive background in television station finance and management. For the past 10 years, he has been with Communications Corp. of America, first as CFO, then becoming its president in 2006 and president-CEO, as well as a member of the board, in 2007.
Pruett served as special strategic adviser to DirecTV and Thomson Consumer Electronics from 1998 to 2002. From 1995 to 1999, he was a managing director at Communications Equity Associates. During his career, he has helped found several broadcast groups as an initial investor, financier, managing partner or board member including Spanish Radio Group Excel Communications, Acme Television, USBG and UPI Media, where he was president.
Since 2008, Pruett has been a key member of the Fox Affiliate Board of Governors where he served as treasurer until 2011 when he was elected chairman, a position he currently holds.