Sinclair Broadcast Group Inc. (SBGI) has reached a definitive deal to buy the broadcast assets of six television stations owned and/or operated by Newport Television for $412.5 million. The six stations are located in five markets and reach 3.0% of the U.S. TV households. The company anticipates the closing and funding of the purchase to occur no earlier than December 2012. Following this, the company expects to finance the $412.5 million purchase price, less a $41.25 million deposit, through cash on hand along with a bank loan and/or by accessing the capital markets.
David Smith, President and CEO of Sinclair, noted, "Assuming our ability to create synergistic opportunities and given current market conditions, we believe the stations will be free cash flow accretive and add approximately $55.0 to $60.0 million of pro forma TV operating cash flow, on average, for 2012/2013."
Also, Sinclair would purchase Newport's rights under the local marketing agreements with WLYH (CW 23) in Harrisburg, PA and KMTW (MNT 35) in Wichita, KS, as well as options to buy the license assets.
The company has also inked deals with Deerfield Media Inc. to sell Deerfield the license assets of one of Sinclair's stations in San Antonio (KMYS CW), and Sinclair's station in Cincinnati (WSTR MY), subject to FOX Television Stations purchase option with respect to WSTR which expires March 31, 2013, and to assign Deerfield the right to buy the license assets of WPMI and WJTC in the Mobile/Pensacola market, after which the company would provide sales and other non-programming services to each of these four stations pursuant to shared services and joint sales deals. Newport also broadcasts several secondary channels, comprising CW and MNT, among others, which would also be bought under this transaction.
Separately, Sinclair announced the entering of deal to purchase the assets of Bay Television, Inc. (Bay TV), which owns WTTA-TV (MNT) in the Tampa/St. Petersburg, Florida market, for $40 million.
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