Jump to content

Welcome, Guest!

Sign In or Create my Account to gain full access to our forums. By registering with us, you'll be able to discuss, share and private message with other members of our community.
CircleSeven

Nexstar to acquire Tribune

Recommended Posts

Nexstar has officially announced this morning that it will acquire Tribune Media at a deal valued at $6.4B.

  • Nexstar will acquire the outstanding shares of Tribune for $46.30 a share, valued at $6.4B. The $6.4B amount includes the assumption of Tribune's outstanding debt.
  • Tribune shareholders could received an additional $0.30 a share, per month, if the deal doesn't close by August 31, 2019.
  • The deal is subject to approval from Tribune shareholders. And aside from Nexstar spinning off divested stations to get the greenlight from regulators, Nexstar also said that it might also spin-off other assets "which it deems to be non-core". 

 

Edited by CircleSeven
  • Like 3

Share this post


Link to post
Share on other sites

What would qualify as "non-core" assets in this case? A lot of their smaller, more hopeless markets which just bring nothing to the table in this day and age? Or the duopoly/speculator bait?

I think that this deal will have more headaches than the Sinclair deal would have just based on the scale of stations and the work needed to be done to meet the cap. Those shareholders are going to be earning some serious pocket change since if such deals as ComCorp and Media General are any indication, I see this dragging perhaps into 2020.

  • Like 1

Share this post


Link to post
Share on other sites
1 hour ago, scrabbleship said:

What would qualify as "non-core" assets in this case? A lot of their smaller, more hopeless markets which just bring nothing to the table in this day and age? Or the duopoly/speculator bait?

On page 12 of powerpoint presentation it said divestitures of "stations and non-core assets". My guess would be the "non-core" means assets like their real estate assets (if you look at p.8). .

I thought they already sold the Tribune Tower & the Channel 9 building. They must have some other buildings they have yet to sell.

Quote

I think that this deal will have more headaches than the Sinclair deal would have just based on the scale of stations and the work needed to be done to meet the cap. Those shareholders are going to be earning some serious pocket change since if such deals as ComCorp and Media General are any indication, I see this dragging perhaps into 2020.

The ComCorp deal lasted about twenty months because one part of the deal would've had Nexstar operating a third station (remember Rocky Creek?) and the DOJ wasn't having that. So they had to amend the application and sold that Evansville station to a real third party.

The MG deal lasted about year. And Nexstar made nothing but clean divestitures (not just in-market, but to comply with the 39% cap). That deal would've been completed before the new year (2017), if they didn't have that spectrum auction (The DOJ signed off on the deal that fall), plus they had to ask the FCC to approve the deal while the auction process was still going.

I would expect Nexstar to make similar moves like the MG deal, and not playing "shell games" like Sinclair.

Edited by CircleSeven
  • Like 1

Share this post


Link to post
Share on other sites

One interesting aspect of the deal is that it would link WDVM (a station with a functioning news department) with WDCW (which just recently cancelled a WTVR-produced 10:00 p.m. newscast). Would it be out of the question for Nexstar to use the WDVM news department to launch separate newscasts for WDCW or simply simulcast those that are already carried on WDVM's schedule on both stations? It's also convenient for Nexstar since it has a D.C. bureau to which they could use the WDCW facility to operate from.

Edited by T.L. Hughes
  • Like 4

Share this post


Link to post
Share on other sites

I think Nexstar tried to play a bunch of shell games in the ComCorp deal and in at least one case (Evansville) eventually gave up and decided to play fair. Also they seem intent on avoiding a repeat of the Sinclair drama. The joint press release threw all kinds of shade at the Heathens.

  • Like 2

Share this post


Link to post
Share on other sites
4 hours ago, PelicanGuy said:

Better them than Sinclair.

You bet! Good to hear that we won't be having to hear that "dangerous to our democracy" bullgipp on WGN and KTLA, among others.

  • Like 1

Share this post


Link to post
Share on other sites
1 hour ago, T.L. Hughes said:

One interesting aspect of the deal is that it would link WDVM (a station with a functioning news department) with WDCW (which just recently cancelled a WTVR-produced 10:00 p.m. newscast). Would it be out of the question for Nexstar to use the WDVM news department to launch separate newscasts for WDCW or simply simulcast those that are already carried on WDVM's schedule on both stations? It's also convenient for Nexstar since it has a D.C. bureau to which they could use the WDCW facility to operate from.

As a sidebar to my earlier comment, for some reason, Washington, D.C.-Hagerstown are among the 15 markets where they would need to make divestitures (they only need to fully divest in 13 markets, with the other two being optional). That doesn't seem to make much sense since, under the previous Sinclair deal, that group planned to pair WDCW with WJLA. By definition, wouldn't a WDCW-WDVM pairing be legal in parlance as well?

  • Like 1

Share this post


Link to post
Share on other sites
1 hour ago, CircleSeven said:

And guess who just woke up??..... Free Press

Get ready to hear a mouthful from the advocacy groups.

No realistic buyer would make them happy when you consider the Starboard Value demands.

  • Like 1

Share this post


Link to post
Share on other sites
55 minutes ago, T.L. Hughes said:

As a sidebar to my earlier comment, for some reason, Washington, D.C.-Hagerstown are among the 15 markets where they would need to make divestitures (they only need to fully divest in 13 markets, with the other two being optional). That doesn't seem to make much sense since, under the previous Sinclair deal, that group planned to pair WDCW with WJLA. By definition, wouldn't a WDCW-WDVM pairing be legal in parlance as well?

The list on the TVNewsCheck article lists the markets where they overlap. They have to divest a station in at least 13 of those 15 markets, but Washington-Hagerstown might be one of the two where they won't have to make a divestiture.

Edited by broadcastfan9751

Share this post


Link to post
Share on other sites

Nexstar stated in a conference call this AM, that it could fetch up to $75M in extra retrans fees, plus proceeds from spin-off properties could be worth as much as $1B.

Sook also stated about the two-decade track record of getting deals done.

From B&C:

Quote

Sook pointed to Nexstar’s record of getting regulatory approval over 22 years of doing station deals as an indication its acquisition of Tribune wouldn’t get hung up in Washington.

“I think we will take the tack that we always have of being respectful of the regulatory authorities, mindful of the rules, and delivering a compliance game plan that all parties can agree to,” Sook said. “I don’t think we will do anything different. I think that it might be different than the approach that was taken by the previous acquirer. But it’s not going to be any different than the track record of success and the credibility that we’ve built with these regulatory agencies over 20 plus years of doing business with them.”

Analysts also asked abou what Nexstar will do with cable outlet WGN America. Even though Sook said he didn't have immediate plans on selling the network, he also said that some outside entities have expressed interest in the channel. And if a right deal came about, he wouldn''t mind selling it.

From Multichannel News:

Quote

What will happen to Tribune Media’s cable channel WGN America is still up in the air. Sook said that he was impressed with the turnaround at the channel: cash flow has gone from a negative showing in 2017 to a “nine-digit” positive this year. But he said some outside parties have expressed interest in buying the channel, and if the right deal came along, Nexstar would sell the network.

“I would say we’re happy with the progress they have made,” Sook said on the call. “If someone is willing to pay a significant premium, we’re also happy to have that discussion as well. Currently we have no plans to immediately divest of it.”

Quote

Tribune owns cable network WGN America and analysts wanted to know if Nexstar planned to sell WGNA to reduce its debt.

“There have been some expressions of interest in buying that. Obviously once we own it a divestiture is a taxable event so we would want to make sure we would be properly compensated for that,” Sook said. “I would say that we are happy with the progress that they have made but again if someone is willing to pay a significant premium we’re also happy to have that conversation as well. But currently we have no plans to immediately divest WGNA.”

 

Edited by CircleSeven
  • Like 3

Share this post


Link to post
Share on other sites

Nexstar doesn’t own radio stations. They never have.

Unless they want to be like Sinclair (who kept KOMO/KVI/KPLZ) or TEGNA (who kept KFMB A/F) as an M&A tag-along, WGN 720 is going to go for a pretty penny, either to iHeart, Hubbard or Cumulus.

In a way, that would be rather fitting to see the former home market for Tribune — which once boasted the Chicago Tribune, WGN 720, channel 9, SuperStation WGN/WGN-A, CLTV and the Cubs — being almost entirely broken up.

  • Like 6

Share this post


Link to post
Share on other sites
1 hour ago, Myron Falwell said:

Nexstar doesn’t own radio stations. They never have.

Unless they want to be like Sinclair (who kept KOMO/KVI/KPLZ) or TEGNA (who kept KFMB A/F) as an M&A tag-along, WGN 720 is going to go for a pretty penny, either to iHeart, Hubbard or Cumulus.

In a way, that would be rather fitting to see the former home market for Tribune — which once boasted the Chicago Tribune, WGN 720, channel 9, SuperStation WGN/WGN-A, CLTV and the Cubs — being almost entirely broken up.

Let's hope it's Hubbard, they're not very big and/or corrupt.

  • Like 1

Share this post


Link to post
Share on other sites
30 minutes ago, Spectrum27 said:

Let's hope it's Hubbard, they're not very big and/or corrupt.

Plus they have a very strong cluster in Chicago (SheFM, The Drive and The Mix). Hubbard is even more stingy in radio than they are with TV, and their CEO Ginny Morris has publicly stated their intentions to continue as such. She's the anti-Lew Dickey.

 Pair that with Hubbard's recent purchase of Alpha Media's West Palm Beach cluster, and that bodes well for WGN.

  • Like 1

Share this post


Link to post
Share on other sites

Do you think we might be hearing statements like that from the CEO of some privately-held/family-owned TV group in 20 years' time?

Share this post


Link to post
Share on other sites
5 hours ago, CircleSeven said:

And guess who just woke up??..... Free Press

Get ready to hear a mouthful from the advocacy groups.

And from Democrats when they take control of the House next year, even if Nexstar does what they did in the Media General deal they're still going to be in for an ugly dogfight with Democrats who we all know, HATES any form of media mergers.

One other note with this deal, KFOR/KAUT will be bordered by KFDX/KJTL/KJBO in Wichita Falls-Lawtown (down the H.E. Bailey Turnpike) the Kansas State Network up I-35 in Wichita either KFSM/KXNW or KNWA/KFTA down I-40 in Fort Smith, KODE/KSNF up the Turner and Will Rogers Turnpikes in Joplin, the Triopolies of KTAL, KMSS and KSHV in Shreveport-Texarkana and KAMR, KCIT and KCPN in Amarillo respectively

Share this post


Link to post
Share on other sites
9 hours ago, scrabbleship said:

What would qualify as "non-core" assets in this case? A lot of their smaller, more hopeless markets which just bring nothing to the table in this day and age? Or the duopoly/speculator bait?

I would say The TV Food Network Properties - The Cooking Channel and Food Network  minority stakes along with the 5% of the Cubs. 

Edited by rkolsen
  • Like 3

Share this post


Link to post
Share on other sites
2 minutes ago, channel2 said:

Do they still own part of the Cubs?

Yeah it was listed as 5% in the PowerPoint.

 

Why TV stations and groups that have graphic designers who could do a better job continue to rely on powerpoints is beyond me. Yes PowerPoint is universal but they could export the content as an image or animation into the document.

Edited by rkolsen
  • Like 1

Share this post


Link to post
Share on other sites
2 hours ago, rkolsen said:

Why TV stations and groups that have graphic designers who could do a better job continue to rely on powerpoints is beyond me. Yes PowerPoint is universal but they could export the content as an image or animation into the document.

At least they converted it to a PDF before uploading it.

 

Share this post


Link to post
Share on other sites
5 hours ago, oknewsguy said:

And from Democrats when they take control of the House next year, even if Nexstar does what they did in the Media General deal they're still going to be in for an ugly dogfight with Democrats who we all know, HATES any form of media mergers.

What the what?

You're living under the assumption that there is a unified opposition to M&As of any sort by Democrats. That is not the case. And even then, they don't control the Senate or the FCC. They have the power to initiate a House hearing with Perry Sook, but what good would that do? Yeah, he's a Republican and a businessman, and he wants further dereg. Big freaking deal. He doesn't impose his personal or political beliefs directly onto the stations he owns, and they don't overtly editorialize for one political party or set of beliefs. An "ugly dogfight" with Nexstar is not going to happen, Democrats have enough stuff that they need to worry about.

Furthermore, what sank Sinclair wasn't any opposition, it was themselves and their own hubris. They chose not to play by the rules and the FCC burned them big-time. You can rest assured that Nexstar will do everything possible to get in the good graces of the FCC and DOJ to meet up with the existing requirements, including addressing the 39% cap issue and making the necessary divestitures. And everyone at the company, including Perry himself, will be on their bestest behavior to not alienate any legislators.

Edited by Myron Falwell
LOL my replies somehow keep getting merged!!

Share this post


Link to post
Share on other sites
5 hours ago, rkolsen said:

Yeah it was listed as 5% in the PowerPoint.

 

Why TV stations and groups that have graphic designers who could do a better job continue to rely on powerpoints is beyond me. Yes PowerPoint is universal but they could export the content as an image or animation into the document.

5c0605c020152c198349ad20.thumb.png.d47f5783d5b38e7c42d794e519b08bdb.png

Edited by Myron Falwell
  • Like 7
  • Haha 9

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.
Note: Your post will require moderator approval before it will be visible.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.


×
×
  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue. By using TVNewsTalk you agree to the Terms of Use and Privacy Policy.