The $4.61 billion total is almost entirely due to the $4.6 billion deal by Nexstar to acquire Media General.
TV Station 1Q M&A Includes 4th-Largest Deal
U.S. TV station M&A volume reached $4.61 billion in the first quarter of 2016, excluding construction permits (CPs) and partial deals, according to SNL Kagan estimates announced today.
Almost all of it was attributable to Nexstar Broadcasting Group’s Jan. 27 definitive agreement to acquire all of Media General Inc.’s assets — a deal that subsequently terminated Media General’s pending $3.10 billion merger agreement with Meredith Corp., announced on Sept. 8, 2015.
Nexstar’s acquisition — at $4.60 billion the fourth-largest TV deal in U.S. history — accounted for 97% of first quarter TV deal volume. The remaining 3%, or $13.1 million, came from a few small transactions filed before the FCC Incentive Auction quiet period that began on Jan. 12. Until the auction runs its course, which could take six to nine months or more, the FCC will not approve any applications for broadcast transactions involving full-power or Class A TV stations.
With the Nexstar–Media General merger remaining the only cash flow transaction in the TV realm, the 8.5x forward buyer’s multiple of that transaction is also the quarterly average.
Radio reached a volume of $89.5 million, representing the lowest quarterly radio deal volume since the first quarter of 2012. However, with CBS Corp.’s announcement, made at the company’s March 15 Investor Day, of a possible sale or spinoff of CBS Radio, there has been much speculation as to radio buyers potentially interested in top-market CBS Radio stations.
The top radio deal of the quarter was the $10 million sale of noncommercial KUHA-FM Houston, followed by another noncommercial transaction, the $8 million sale of FM stations KPLI, KPLU, KPLI and KVIX as well as seven translators and one translator construction permit in the Seattle-Tacoma, Wash., market from Pacific Lutheran University to University of Washington.
BRAND CONNECTIONS
The radio market closed the quarter with an average 6.5x multiple — slightly lower than 2015’s 6.7x.
In addition, $8 million was paid in radio’s largest cash flow deal of the quarter. KFWB-FM Los Angeles was sold by CBS Corp. to Universal Media Access KFWB-AM LLC for an estimated 6.3x forward seller’s multiple.
Comments (0)