Tribune Co. has announced this morning that it will buy 19 TV stations from Local TV Holdings in a deal worth approximately $2.7 billion. After the purchase, Tribune will become the biggest commercial TV station group in the nation.
The Deal Between Tribune And Local TV
Early this morning, the media giant announced on its website that it had entered into a definitive agreement with Local TV to buy all of its 19 TV stations, which are located in 16 important markets. The deal is worth $2.725 billion in cash. Tribune Co. currently owns 23 stations covering markets from New York to Loss Angeles and from Miami to Seattle.
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After the purchase of the TV stations, Tribune Co. will own 14 Fox stations and become the biggest affiliated station group for Fox Broadcasting. It will also own 14 CW network stations. The CW network is a joint venture between Warner Bros. and CBS.
Tribune Co. will also own a total of five CBS stations, three ABC stations and two NBC stations. Within the nation’s 20 biggest markets, it will hold 14 stations. Tribune Co. also stands to gain significant amounts of advertising capital, especially during political ad season. The LA Times’ Meg James reports that in recent election years, stations in key battleground states like Ohio, Colorado, Pennsylvania and Virginia have raked in large amounts of political ad spending.
Closing The Deal Between Tribune Co. And Local TV
The boards of both companies have approved the transaction, and they expect the deal to close by the end of this year. It is however, subject to approval by the Federal Communications Commissions and also an antitrust review.
This will be the first big purchase for Tribune Co. since it left bankruptcy protection at the end of 2012.
The Importance Of The Deal For Tribune Co.
The company said the addition of Local TV’s stations to its group are especially important because most of the stations are ranked either number one or number two in their markets. As a result, Tribune will see “significant free cash flow” that will be “immediately accretive to Tribune’s earnings.” The company also said it will “lead to more meaningful conversations with affiliates about distribution,” which it deems as being especially important to WGN America and its future.