Newport is Providence Equity’s holding company for the collection of TV stations the private equity firm bought in 2007 from Clear Channel. Investors seem to like Nexstar’s $285.5M agreement today for 12 Newport stations; Nexstar shares are +5.2% at mid-day. Sinclair is more complicated: In addition to the $412.5M it’s paying for six Newport stations, Sinclair agreed today to pay $40M for Tampa-based Bay Television. Sinclair shares are -1.6%. Privately held Cox is paying $302M for its four stations.
Here’s the release:
KANSAS CITY, Mo., Jul 19, 2012 — Newport Television, LLC (“Newport”) today announced that it has signed three separate agreements to sell twenty-two television stations throughout the United States to Nexstar Broadcasting Group, Inc. NXST +8.48% , Sinclair Broadcast Group Inc. SBGI -1.42% , and Cox Media Group. The total value of these transactions is approximately $1 billion, representing an aggregate LTM broadcast cash flow multiple of 10.5x and an aggregate LTM EBITDA multiple of 11.4x.
Details regarding the individual transactions are as follows:
— Nexstar Broadcasting purchased twelve stations, including: KTVX and KUCW (Salt Lake City, UT); KLRT and KASN (Little Rock, AK); WPTY and WLMT (Memphis, TN); WJKT (Jackson, TN) WSYR (Syracuse, NY); WETM (Elmira, NY); WIVT and WBGH (Binghamton, NY); and WWTI (Watertown, NY). Nexstar Broadcasting also purchased Newport’s Inergize Digital Media operations.
— Sinclair Broadcast purchased six stations, including: WOAI (San Antonio, TX); WHP (Harrisburg, PA); WKRC (Cincinnati, OH); WPMI (Mobile, AL); and KSAS and KMTW (Wichita, KS). Sinclair also is acquiring Newport’s rights to program and operate WLYH (Harrisburg, PA) and KMTW (Wichita, KS) pursuant to local marketing agreements.
— Cox Media Group purchased four stations, including: WAWS and WTEV (Jacksonville, FL); and KOKI and KMYT (Tulsa, OK).
The Company is continuing to pursue a sale of its five remaining stations: KGET (Bakersfield, CA); KGPE (Fresno, CA); WHAM (Rochester, NY); WXXA (Albany, NY); and KMTR (Eugene, OR).
Sandy DiPasquale, President and Chief Executive Officer, said, “These divestitures are the result of a thoughtful strategic review process conducted by the Board to maximize value at Newport, and we believe these high quality stations will have a bright future with their new owners. Nexstar, Sinclair, and Cox are well-suited to foster continued success at each of these stations. We and our partners at Providence appreciate the hard work and dedication of all the employees at our television stations. We are in discussions with potential buyers of our remaining stations and are confident we will find the right new owner for each of them.”
Al Dobron, a Managing Director at Providence Equity, which owns a majority stake in Newport, commented, “We thank Sandy and everyone at Newport for their outstanding contributions to the company’s strong performance over the last four years. We are pleased with the value that we have added together and expect these stations to continue their success in the years ahead.”
The transactions are each subject to regulatory approval and are expected to close in the fourth quarter of 2012. Moelis & Company is acting as Newport’s exclusive financial advisor, Weil, Gotshal and Manges is acting as its legal advisor, and Covington & Burling is acting as its regulatory counsel on the transactions.