Nexstar Poised To Buy CCA Stations

It’s signed a letter of intent and is conducting due diligence on CCA properties encompassing 12 stations in smaller markets. The deal would boost Nexstar’s portfolio to about 84 stations. In other TV group news, Local TV LLC has put itself up for sale.

Nexstar Broadcasting is on the verge of closing a deal to acquire Communications Corp. of America, according to sources.

Nexstar has signed a letter of intent and is conducting due diligence on CCA properties encompassing 12 stations in smaller markets.

CCA stations are in markets ranging Shreveport, La. (DMA 82), to Alexandria, La. (DMA 179). Nexstar’s portfolio ranges from Washington (DMA 8) to St. Joseph, Mo. (DMA 201). Most are in mid-size to smaller markets.

The acquisition would boost Nexstar’s station count to roughly 84, bump up its duopoly count by at least one and enhance its already strong presence in Louisiana and Texas.

The seller multiple for the transaction likely will come in around 7-8 times cash flow, roughly in line with cash flow multiples for recent transactions. Until Nexstar completes due diligence and analyzes potential synergies, the buyer multiple remains unclear, though it’s highly likely to be a point or two lower than the seller multiple.

The two companies hope to announce the transaction by or before the upcoming NAB Show, which kicks off in Las Vegas on April 6.

BRAND CONNECTIONS

At deadline, executives at Nexstar and CCA had not returned phone calls requesting comment.

In another sign of the station trading market heating up, Local TV LLC has put itself up for sale. Management at the stations has begun informing employees to look for potential buyers looking at the stations in the coming weeks and months.

Local TV LLC is the company formed by the former New York Times stations when they were purchased by Oak Hill Capital for $575 million in 2007. Headed by Bobby Lawrence, Local TV LLC portfolio ranges from large markets, including KDVR-KWGN Denver (DMA 17), WJW Cleveland (DMA 18), down to small, including WQAD Davenport, Iowa (DMA 99), and KFSM, Fort Smith, Ark. (DMA 101).

Managers at the Local TV LLC stations either declined to comment, did not return phone calls requesting comment or referred inquiries to corporate executives. As of deadline, corporate executives had not returned calls requesting comment.


Comments (3)

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Linda Leavell says:

March 22, 2013 at 6:22 pm

Both KWGN and KPLR owned by Tribune Company.

Joanne McDonald says:

March 23, 2013 at 12:53 am

I would favor Nexstar/Mission grabbing WPMI/WJTC, WHP/WLYH, WSYT/WNYS, WYZZ, KRCG, KHQA, KTVO, and KBTV from Sinclair with Sinclair grabbing KMSS/KSHV, WEHT/WTVW with WTVW regaining the FOX affiliation while WEVV keeps the CBS and MYNET affiliations, KLRT/KASN, and WUHF from Nexstar/Mission. Nexstar ought to give the JSA/LMA/SSA for KDBC to Sinclair to be house together with KFOX inside KFOX studios. Nexstar ought to also have KOZL regaining the FOX affiliation while KRBK keeps it’s MYNET affiliation.

I would favor Meredith buying all of Local TV LLC stations with ABC moving back to WGHP and FOX moving back to WXLV in Greensboro-High Point, ABC moving back to KTVI and FOX moves to KPLR in Saint Louis and FOX moves to KWGN and CW moves to KDVR in Denver in a side deal unrelated to a Sinclair owned and or operated TV station. I would favor FOX buying KPLR and KWGN from Tribune to turn them into FOX owned and operated stations.

Stephen Borg says:

March 23, 2013 at 6:41 am

I am replying specifically to the sale of KWGN and KDVR. KWGN is a CW affiliate owned by Tribune and KDVR is a Fox affiliate owned by Local TV LLC; KWGN is operated under an LMA by KDVR. While Local TV just announced the sale of all of their stations, Tribune has just recovered from bankruptcy and is reestablishing its dominants, first at WPIX and then, likely, at KWGN.

You stated: “FOX moves to KWGN and CW moves to KDVR in Denver in a side deal unrelated to a Sinclair owned and or operated TV station. I would favor FOX buying KPLR and KWGN from Tribune to turn them into FOX owned and operated stations.”

This idea is almost negligible in considering because of three things. First, Tribune is not selling any stations whatsoever. The indication that Tribune hired Larry Wert implies that Tribune will focus on rebuilding its television stations and furthermore, their announcement with the intent to sell all of their newspaper brands only confirms their focus on broadcasting. Second, KWGN has never been a Fox affiliate and KDVR has never been a CW affiliate. Because KDVR owns the building and holds the station contracts with the personnel at the virtual duopoly, it is not likely that they will at all switch affiliations for a lower rated network. Thirdly, Fox Television Stations owned and built the newscasts at KDVR in 1994. They later sold it to Local TV with several of their other stations. There is no indication that Fox will want to buy back their old O&O.

The most likely situation that I can identify is that Tribune buys KDVR from Local TV. The KDVR/KWGN LMA is quite valuable, especially to Tribune. Unfortunately, we don’t know what is written on the LMA agreement with regard to station sales and new ownership. But we do know that the relationship between both stations is strong and to break apart such an integrated team could possibly wreak havoc on the Denver news market.

To keep up with new information and read other people’s thoughts and hypotheses, visit http://forums.tvnewstalk.net/index.php?/topic/12723-local-tv-selling-off-stations/ and explore the site to garter new information about broadcasting.


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