As one industry observer puts it: "If you're not looking to merge or acquire, you're a bonehead dinosaur. Everybody should be on the block. If you bought assets to eventually sell, now is the time to sell." Among the station groups in play are Local TV LLC/FoxCo’s 21 stations; Allbritton; Grant Communications; and Granite Broadcasting. Possible buyers include Sinclair, Nexstar, Fox, Raycom, LIN and ABC.
Planets Align For Station Trading Tsunami
Strap in because the station trading market is about to get extra lively.
First up: Today’s the deadline for final bids on Local TV LLC/FoxCo.’s 21 stations. Technically, they are separate groups, but they have common ownership and are likely to go as a single entity.
Their markets range from Denver (DMA 17) to Fort Smith, Ark. (DMA 101), with the majority of the stations in Top-50 markets.
Potential bidders include the usual suspects, namely Sinclair and Nexstar. That said, the Local/FoxCo. stable encompasses markets a bit bigger than Sinclair and Nexstar typically have targeted. But in today’s anything-goes environment, it’s safer to count those two bidders in.
Meredith also could be a player. In an April 2 interview with the Des Moines Register, Stephen Lacy, CEO of Meredith, expressed interest in acquiring some of the stations.
In the interview, Lacy said: “Owning TV stations has been a fabulous model for us. It generates tremendous cash flow, allows great investment opportunities. TV is a big part of the strong cash flow and shareholder return initiative we launched a few months ago.”
BRAND CONNECTIONS
Lacy’s words echo the working philosophy of Media General, which recently announced it would merge with Young, and Gannett, which recently announced it would merge with Belo.
Fox could also be a buyer for the FoxCo. stations, which it spun off in 2008. Sources familiar with the situation say Fox regrets selling the stations and may attempt to reacquire some of them.
Then there’s Allbritton. One source described the bidding for the group as a “horse race” that includes Raycom, Sinclair, Nexstar, LIN and others. People familiar with that situation say ABC also wants Albritton’s crown jewel, WJLA in Washington, D.C. (DMA 8).
So, like the Local/FoxCo. auction, the Allbritton deal looks like it will have a lot of moving parts. Don’t be surprised if groups that have been relatively quiet — namely, Hearst, Tribune and Scripps — enter the M&A fray.
Two smaller deals could also be in the offing.
Grant Communications, which owns seven stations, including five Fox and two CW affiliates in smaller markets, is likely to go to Sinclair, according to one source.
Then there’s Granite Broadcasting with 10 stations in markets including San Francisco (DMA 6) and Detroit (DMA 11) and eight smaller markets. Granite is run by the same folks who ran Communications Corp. of America, which Nexstar recently acquired.
Meanwhile, don’t be surprised if a number of other groups put up for-sale signs.
“Everybody’s looking for a way they can partner up,” says one highly placed source. “If you’re not looking to merge or acquire, you’re a bonehead dinosaur. Everybody should be on the block. The planets align occasionally and they’re probably aligned more than they’ll ever be again. If you bought assets to eventually sell, now is the time to sell.”
Comments (11)
Linda Leavell says:
June 21, 2013 at 7:15 am
KWGN and KPLR are owned by Tribune Company. Operated by Local TV. Hand off, Leve 2 Tribune Station Alone!
Linda Leavell says:
June 21, 2013 at 7:17 am
ABC Will Buy WJLA-TV and Make ABC O&O in Washington, DC. Area.
Shenee Howard says:
June 21, 2013 at 9:54 am
Anyone but Sinclair for the FoxCo stations. They already own the ABC affiliate in St. Louis, which they run as a joke. No local presence. No local news. It is an embarassment for a top 25 market ABC affiliate. There has to be something wrong with the number of stations they have bought, the amount of debt, not to mention operating them in their won political slant rather than in the public interest.
Sean Smith says:
June 21, 2013 at 10:20 am
I don’t see an issue with Sinclair and the FoxCo stations. Sinclair owns mostly Fox stations anyway, and Sinclair is the company who started the multi-buying frenzy in the first place. Sinclair has been the actor in this play, the other groups like Nextstar, Belo, Gannett, Media General, and LIN have been the REACTORS, reacting to what Sinclair is doing. It’s obvious that those groups are banding together and increasing their portfolios to keep from being taken over by Sinclair. As far as St. Louis, who’s to say that Sinclair doesn’t just go in and purchase KSDK and KMOV, then spin off the ABC station? That’s entirely possible. And I don’t think Sinclair cares one way or the other whether you think the St. Louis ABC station is an embarrassment, because Sinclair is obviously making money with it. As an aside, I would like to see Sinclair get into a bidding war with ABC over WJLA…ABC has always wanted it (it is, after all, a Channel 7), but Sinclair is based in Baltimore 60 miles away. Sinclair’s strategy is not to purchase big market stations (Seattle is the only exception)… they can make more money purchasing dozens of small to medium market stations (Top 20 on down), than spending the same amount of money for a WJLA or a KSDK, and not get as much of a return on advertising. Also, I’ve been watching, and so far, none of Sinclair’s purchases have violated anti-trust laws. Frankly, I’m enjoying the media circus trying to catch up to Sinclair.. it’s rather amusing.
antonio berretta says:
June 21, 2013 at 10:38 am
If you compete against Nexstar you hope they buy a station in your market….If they buy you its not a good day for you or Broadcasting
antonio berretta says:
June 21, 2013 at 10:39 am
This just goes the show you how the last thing the FCC under this president is intereted in is protecting the public trust…
Maria Black says:
June 21, 2013 at 1:20 pm
I’m curious as to why the article and commentary leave out NBC as potential buyer for some of the stations. Is it because they don’t want anything below a certain DMA? And while one station is mentioned as coveted by ABC, they don’t have that many stations, why not more? I can see CBS not being interested, they have a good amount already. Not to draw a neon sign pointing to my ignorance, but I’m legitimately curious. Maybe because these MSOs are multi-affiliate as well, and the big Four will only buy their affiliate and no MSO wants to piecemeal out their stations? I figure this is the right crowd to get the reaction from.
Maria Black says:
June 21, 2013 at 1:21 pm
In regards to all this buying/selling frenzy, not just the Local TV stations.
Joanne McDonald says:
June 21, 2013 at 2:46 pm
I would rather see Gannett spinning off KSAW, KMSB/KTTU, and KMOV to Meredith and combined the operations of KSAW with KPHO, and spinning off KTVK, and WHAS to Scripps and combined the operations of KTVK with KNXV with ABC moving to KTVK and KNXV becomes independent for competitive reasons and a very true win-win situation for Gannett, Meredith, and Scripps. LIN could buy WSET, WCIV, and maybe WHTM from Allbritton and KSTU, KDVR and turned into a CW station which CBS could buy and form a duopoly with KCNC with KWGN getting FOX, WDAF, KTVI and turned into a ABC station with KPLR getting FOX and KDNL getting CW for competitive reasons and a very true win-win situation in Saint Louis, WITI, WJW, WHNT, WGHP and turned into a ABC station with WXLV getting FOX, and maybe WNEP from Local TV LLC, while Meredith could buy KWGN and KPLR if Tribune would ever sale various stations to help pay off it’s debt from their 2008 bankruptcy along with the ability to buy KSL in Salt Lake City from Bonneville International if they decides to want to sale the station completely as a way for KSL to be able to keep it’s NBC affiliation and buy KFOR/KAUT, KFSM/KXNW, WHO, WQAD, WREG, WTVR, and WTKR/WGNT from Local TV LLC. I would allow FOX or Nexstar to buy KPLR and KWGN from Tribune if I still want Meredith to own KSAW, KMSB/KTTU, and KMOV from Belo.
I would consider a 3 way swap between NBC, Media General, and Sinclair Broadcasting Group with NBC grabbing KRON as an NBC O&O and the station is housed with KSTS in San Jose, Sinclair grabbing KNTV as a MYNET affiliate or be an independent and share operations with KRON in San Jose until building a solo building for KNTV, and Media General grabbing WTVC. I would have liked the idea of Journal trading WFTX for WLAJ to form a duopoly with WSYM while WLAJ is assigned to a third party with combined operations in Lansing, Meredith trading WGCL for WBAY and KELOLAND and Quincy trading WVVA and possibly WSJV for KWQC as a way to help Young pay off it’s debts from it’s bankruptcy and improve regional clutter for Media General and other broadcasting companies. I would favor Media General being able to grab WLGA from Harry Pappas and his Pappas Telecasting and formed a legal duopoly with WRBL.
I would favor Nexstar/Mission grabbing WPMI/WJTC, WSYT/WNYS, WYZZ, KRCG, KHQA, KTVO, KEYE, WOAI, and KBTV from Sinclair with Sinclair grabbing KLRT/KASN, WLYH and WUHF from Nexstar/Mission. I would favor Raycom/American Spirit Media grabbing WACH and WFXL. I would favor London Broadcasting grabbing KGBT. I would favor News Press Gazette grabbing KVII/KVHI. I would favor Gannett buying WTTA to merge with WTSP, WUCW to merge with KARE, and KDNL to merge with KSDK.
I would like to see Una Vez Mas buying KAZA, Meredith buying KSWT Journal buying NTV (KHGI/KWNB/KHGI CD)/KFXL, Hearst buying KCWI, Sinclair buying KDMI for it’s programming assets, Journal or LIN or Meredith or whoever buys WITI buying WIWN.
I would favor FOX buying KPLR and KWGN from Tribune to turn them into FOX owned and operated stations or Nexstar owning them and running them as FOX affiliates of their own. I would like to see Nexstar buying KSNV and KRNV/KENV from Jim Rogers. I would like to see Gannett or Hearst buying KLAS.
I would be okay with Hearst getting KATV, and KTUL, with LIN getting WSET, WCIV, and maybe WHTM or with Nexstar getting WHTM and Sinclair transferring the license of WLYH to Cunningham and continue to fully owned WHP, and with Sinclair getting the combined WBMA LD/WJSU/WCFT with the intent of using the the combined WBMA LD/WJSU/WCFT to program FOX on it’s DT1 channel and MYNET on it’s DT2 channel while WABM continues to program MYNET on it’s DT1 channel and add FOX on it’s DT2 channel. Sinclair keeps the CW affiliation on WTTO and WDBB. Sinclair could transfer the license of WTTO and WDBB to Cunningham and WABM to Deerfield while Sinclair fully owns the combined WBMA LD/WJSU/WCFT combo or Raycom could buy the combined WBMA LD/WJSU/WCFT combo and place it under the control of American Spirit Media with the intent to move the FOX affiliation there on it’s DT1 channel with WBRC rejoining the ABC Network on it’s DT1 channel. The combined WBMA LD/WJSU/WCFT combo would air WBRC on it’s DT2 channel or all of it’s programming 24/7 with ABC is transferred and switched onto WBRC while WBRC would air the WBMA LD/WJSU/WCFT combo on it’s DT2 channel or all of it’s programming 24/7 with FOX is transferred and switched onto the WBMA LD/WJSU/WCFT combo.
Debra winans says:
June 21, 2013 at 5:24 pm
My god. How can anyone read this response is beyong me. You can start by using paragraphs
solange attwood says:
June 21, 2013 at 3:44 pm
I agree with jamesl