A total of 164 TV stations changed hands through the first half of 2014, with an average price of $46.5 million. That total was down from the same period last year.
Radio and TV station M&A volume reached $1.85 billion in the second quarter of 2014, more than $2 billion less than in the same quarter of 2013, when $3.88 billion of broadcast stations traded hands, according to SNL Kagan data released today.
TV station deal volume in 2Q 2014 was $1.33 billion, versus $518.6 million worth of radio station deals, still a very robust deal market despite the decline from last year’s huge totals.
On a year-to-date basis through the quarter, broadcast deal volume rose to $5.44 billion versus $6.56 billion in the first half of 2013. A total of 613 stations traded in 2014 YTD, of which 449 were radio and 164 were TV stations. The average TV station price in the first half was $46.5 million, versus $2.3 million for the average radio station.
The pace of consolidation slowed in the TV station market, the company said, no doubt affected by recent FCC regulatory moves. In the largest TV transaction of the quarter, 21st Century Fox, Inc. traded its owned-and-operated outlets in Boston and Memphis for Cox Enterprises, Inc.’s Fox affiliate in San Francisco together with an independent station in the same market. At 8.0x forward cash flow, SNL Kagan estimates each side of this transaction being worth $429.7 million. The largest non-swap deal was Gannett Co.’s $215 million acquisition of six stations from London Broadcasting Co. The average TV station forward seller’s deal multiple YTD stands at 8.8x.
Radio deal volume exceeded $500 million for only the second time since 2011. The top deal was the $105.0 million, 8.0x seller’s cash flow sale of four FM stations from Wilks Broadcast Group to Steel City Media. In addition, SNL Kagan registered three transactions above the $50 million mark: the $72 million sale of nine FM stations from South Central Communications Corp. to Midwest Communications.; Palm Beach Broadcasting’s $66.5 million acquisition of Three Eagles Communications Inc. and its 48 stations; and the $57 million sale of 19 radio stations and one translator from Main Line Broadcasting to Alpha Broadcasting.
SNL Kagan said: “These transactions are an indicator of an increased pace of consolidation in the radio market. In spite of increased deal activity, the average radio forward cash flow multiple rose by only 0.4 point in the last 12 months to 7.3x through [the first half of] 2014.