Nexstar Broadcasting Enters into a Definitive Agreement to Acquire Fresno, California NBC Affiliate KSEE(TV) for $26.5 Million in Accretive Transaction
Nexstar Broadcasting Group, Inc. (Nasdaq: NXST) announced today that its
wholly-owned indirect subsidiary, Nexstar Broadcasting, Inc., has
entered into a definitive agreement to acquire the assets of KSEE(TV),
the NBC affiliate serving the Fresno, California market, from Granite
Broadcasting Corporation for $26.5 million in a transaction that is
expected to be immediately accretive to Nexstar.
Under the terms of the agreement, Nexstar acquired all of KSEE(TV)’s
non-FCC license assets from Granite for $20 million and will file a
license transfer application with the FCC. Upon FCC approval of the
license transfer, Nexstar will pay Granite the remaining $6.5 million of
the total purchase price. Nexstar has entered into a Time Brokerage
Agreement with Granite whereby it will operate KSEE(TV) immediately,
while awaiting FCC approval for the closing of the transaction.
Commenting on the agreement, Nexstar Broadcasting Group President and
Chief Executive Officer, Perry A. Sook said, “With our agreement last
November to acquire KGPE-TV, the CBS affiliate serving the Fresno,
California market, we are delighted to announce the acquisition of the
market’s NBC affiliate, KSEE. KSEE squarely meets our acquisition
criteria as it further expands our revenue, scale and operating base,
creates another duopoly market for Nexstar and is financially accretive.”
The proposed transaction will result in Nexstar operating one station
and/or providing sales and other services to another station in 26 of
the 41 markets where it operates (which assumes the completion of the
acquisitions of five stations from Newport Television, LLC and Smith
Broadcasting both of which were announced in November 2012). In
addition, it will expand to 72 the number of stations and related
digital signals that Nexstar either owns or provides sales and other
services.
Mr. Sook added, “Consistent with Nexstar’s other recently announced
acquisitions, the purchase price for KSEE is approximately 5.0 times the
station’s average 2012/2013 pro-forma cash flow. Under Nexstar’s
ownership, the station will realize additional retransmission revenues
as well as synergistic operating improvements, and as a result, on a
pro-forma basis the acquisition will be immediately accretive to
results.”
Nexstar intends to finance the station acquisition with existing cash on
hand. The license acquisition portion of the transaction is subject to
FCC approval and other customary approvals and is expected to close
mid-year 2013.
"Granite has owned KSEE since 1993 and we have greatly valued the
opportunity to serve the communities of California's Central Valley,"
said Peter Markham, CEO of Granite. "Fortunately, this transaction
maximizes value at Granite and will pass on this great asset and a
dedicated group of talented employees to a new owner also committed to
broadcast excellence."
Nielsen Media’s 2012-2013 Local Market Estimates ranks Fresno,
California as the 55th largest television market in the
country.
About Nexstar Broadcasting Group, Inc.
Nexstar Broadcasting Group is a leading diversified media company that
leverages localism to bring new services and value to consumers and
advertisers through its traditional media, e-MEDIA, digital and mobile
media platforms. Nexstar owns, operates, programs or provides sales and
other services to 67 television stations and related digital multicast
signals reaching 39 markets or approximately 11.6% of all U.S.
television households.
Assuming completion of all announced transactions, Nexstar will own,
operate, program or provide sales and other services to 72 television
stations and related digital multicast signals reaching 41 markets or
approximately 12.1% of all U.S. television households.
Forward-Looking Statements
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these forward-looking statements on our current expectations and
projections about future events. Forward-looking statements include
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in net revenue, cash flow and operating expenses, involve risks and
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factors, including the impact of changes in national and regional
economies, our ability to service and refinance our outstanding debt,
successful integration of acquired television stations (including any
delay in completing such acquisitions, achievement of synergies and
timing and scope of cost reductions), pricing fluctuations in local and
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television stations' operating areas, competition from others in the
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programming costs, the effects of governmental regulation of
broadcasting, industry consolidation, technological developments and
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of the date of this release. For more details on factors that could
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and Exchange Commission.
About Granite Broadcasting Corporation
Granite Broadcasting Corporation is a market-leading owner of local
media properties. The company's operations include broadcast TV
stations, local cable TV channels, and local online and mobile media
properties. Television network partners include NBC, CBS, ABC, The CW
and My Network TV, collectively reaching over 6% of U.S. television
households. Granite's local media operations are characterized by
innovative, best of breed management and market leading franchises.