The Dallas-based station group is adding WFRV Green Bay-Appleton, Wis., and WJMN Marquette, Mich., to its already bulging station portfolio. CBS Perry Sook says the price is less than five times projected 2010-11 cash flow, which he believes he can grow by being more agressive on retrans and through "synergistic operating improvements."
DMAS 71 & 179
Nexstar Buys Two CBS Affils For $20 Million
Nexstar Broadcasting Group announced this morning that is it buying WFRV Green Bay-Appleton, Wis.(DMA 71), and WJMN Marquette, Mich. (DMA 179), from Liberty Media Corp. for $20 million. Both are CBS affiliates.
Subject to FCC approval, the deal will expand Nexstar’s portfolio to 65 stations in 36 markets, reaching approximately 13.5 million TV households. Thirteen of the stations will be CBS affiliates.
Nexstar will pay Liberty $17.5 million in cash, which it intends to raise through borrowings under its senior credit facility, and $2.5 million in Class A common stock.
“The purchase price for the two stations is less than five times the average 2010-11 pro-forma projected cash flow,” Nexstar CEO Perry Sook said in a prepared statement.
“Under Nexstar’s ownership, both stations will realize additional retransmission revenues as well as synergistic operating improvements, and on a pro-forma basis the acquisition will be immediately accretive to results and de-leveraging on a debt-to- cash-flow basis.
“We’ll also bring effective online marketing solutions to local and national advertisers through the launch of Nexstar’s e-Media and mobile offerings through our proven Community Portal model,” Sook said.
BRAND CONNECTIONS
Liberty Media, better known for its stakes in Starz Entertainment and Sirius XM, is part of John Malone’s expansive media holdings. Malone is chairman of Liberty.
Liberty acquired the stations from CBS in 2007 as part of a deal in which CBS bought out Liberty’s small interest in CBS for $170 million and the two stations.
Nexstar said it expects the deal to close in the third quarter of 2011.
Comments (3)
Janet Frankston Lorin says:
April 7, 2011 at 3:47 pm
Hell, for 5x cash flow, I’d buy them!
Hope Yen and Charles Babington says:
April 7, 2011 at 4:16 pm
Green Bay’s a great little market! Almost recession-proof with paper products and packing being two of many small industries. But, it is a grinder of a competitive market with full power, full news operation NBC, ABC and Fox affiliates. Still, Perry’s upside is small, but he paid a really nice price. Good luck, Perry.
Neal Hecker says:
April 28, 2011 at 5:27 pm
The market may be recession proof but the competition is fierce. The ABC affiliate is Young which was stripping $ out of the market to prop up San Fran. The NBC is Journal who decided to cut costs by giving Green Bay it’s Milwaukee newscasts. They fell so fast that they gave away spots on WACY (UPN) which Journal runs. Things were so bad the ACME CW was declared a failed station after Journal and Young decimated the market. If it were not for Libertys access to cash, WFRV might have sold for 2x cash flow if that. Lin’s Fox (WLUK) also had to be thankful for their cash inflow to the market. God knows the market sucked.