Warren Buffett buying WPLG-TV Miami
Warren Buffett, chairman and CEO of Berkshire Hathaway, has agreed to acquire the ABC affiliate from Graham Holdings’ Post-Newsweek stations in exchange for sharply reducing its stake in the company.
Under the agreement, Berkshire Hathaway Inc. gets a Graham subsidiary that will include WPLG, along with an undisclosed amount of Berkshire shares currently held by Graham and cash, noted The Miami Herald.
Buffet’s BH Media currently owns 28 daily and 42 non-daily newspapers. This puts him in the TV broadcast biz as well.
Graham gets 1.6 million shares of Graham Holdings Class B common stock currently owned by Berkshire Hathaway.
Buffett says the deal will greatly reduce his company’s position in Graham. In February, that stake was worth about $1.1 billion.
The specific number of shares of each company and the amount of cash will be determined when the deal closes. However, the Graham stock is worth around $1.2 billion. Graham’s SEC filing says the value of WPLG is $364 million.
No binding agreement has been signed yet in connection with the deal, noted the story.
“I am sure this is a mutually beneficial transaction for both companies,” said Buffett. “While this transaction will greatly reduce our position in Graham Holdings, our admiration for the company and its management is undiminished.”
“Warren Buffett’s 40-year association with our company has been extremely good for our shareholders. Naturally, the deal that we have put together is one that will be good for both companies,” said Donald Graham, chairman-CEO of Graham Holdings. “We thank our longtime colleagues at WPLG for their enormous contributions and congratulate them on the opportunity to join one of the greatest companies in America.”
RBR-TVBR observation: While reports have said Graham isn’t planning any sale of its other Post-Newsweek stations, you never know. Obviously Buffett believes the medium could be a good investment to add to his BH Media division. He may get the TV bug and then look out—he could go on a spree. This buy is a vote of confidence and great news.