Updated at 3:40pm Eastern
As RBR+TVBR was first to report on Wednesday, the privately held parent of Hearst Television is acquiring the NBC affiliate serving Southwest Florida owned by the Waterman family since 1979.
With the filing of the asset purchase agreement signed by Waterman Broadcasting and Hearst with the FCC, deal details are now available — including the purchase price.
It’s in the hundreds of millions of dollars.
The deal was finalized on Tuesday (4/4), and Waterman EVP Steve Pontius, on behalf of Edith Waterman, signed off on an agreement that will see her and her heirs sell WBBH-TV for $220,540,000.
That’s not a typo. And, it is perhaps one of the most head-turning valuations seen in recent memory for a single-station sale in a market that is No. 49 in revenue and No. 55 in rank.
“Oh my god!” exclaimed one veteran media broker when reached by RBR+TVBR. He simply couldn’t believe the sale price.
RBR+TVBR also spoke with Bob Heymann, the veteran Chicago-based broker with Media Services Group, who shared BIA Advisory Services data showing historical transaction data for the last 10 years.
The highest price listed for a single station not sold as part of a group transaction is $145 million, plus working capital.
That deal saw Landmark Media Enterprises sell longtime CBS affiliate KLAS-8 in Las Vegas to Nexstar Media Group. The transaction closed in February 2015 and concluded 27 years of ownership of KLAS for Landmark.
To illustrate just how big the WBBH sale price is, Nexstar Media Group’s 2015 acquisition of KMSS-TV in Shreveport; KVEO-TV in the Rio Grande Valley of Texas; KWKT-TV & KYLE-TV in Waco-Temple-Bryan, Tex.; KTSM-TV in El Paso; WGMB-TV and low-power WBRL-CD in Baton Rouge; WEVV-TV in Evansville, Ind.; KETK-TV in Tyler-Longview, Tex.; KADN-TV & KLAF-LD in Lafayette, La.; KPEJ-TV in Odessa-Midland, Tex.; and WNTZ-TV in Natchez, Miss., serving Alexandria, La., was priced at $270 million. The seller: Communications Corporation of America, then-led by the individual who today serves as Estrella Media’s CEO, Peter Markham.
But what about the $261 million deal involving KOHD-18 in Bend, Ore., which closed in September 2014? That transaction included KOHD with a large MVPD doing business as BendBroadband; KOHD’s entry into the operation came at a price of $2.35 million, RBR+TVBR archival stories confirm.
Then, there is the transfer of control of WFXT-25 in Boston, the market’s FOX affiliate, from Apollo Global Management’s Cox Media Group to Standard General, which is trying to acquire TEGNA. While this transaction is valued at some $300 million, the status of Standard General’s acquisition of TEGNA and its current pending status with the FCC make this deal still a proposed one.
Volker Moerbitz, the longtime Research Analyst with S&P Global’s Kagan arm, shares that 10 other single station deals of $200 million or more have been seen between 2002 and 2022. The largest one was the sale of KCAL-9 in Los Angeles to Viacom from Young Broadcasting. The 2002 deal carried a $650 million price tag.
He also points to the June 2019 sale of WTHR-13 in Indianapolis and WBNS-10 in Columbus, as well as Sports WBNS-FM “97.1 The Fan” and ESPN Radio affiliate WBNS-AM 1460, to TEGNA from Dispatch Broadcast Group. How so? the valuation he places on WBNS is $245 million; however it was sold in a transaction involving other properties totaling $535 million in value.
Meanwhile, Heymann shared BIA Advisory Services data for the last decade as it pertained to Fort Myers-Naples. In 2014, Journal Communications’ sale of its radio and television stations to The E.W. Scripps Co. brought the latter company FOX affiliate WFTX-36 “FOX4.” But, a transaction involving what is today The CW Network affiliate, WXCW-46, saw former Turner Broadcasting CEO Jamie Kellner’s ACME Broadcasting spin the station to locally owned Sun Broadcasting. The deal, which closed in February 2007, was valued at $45 million.
Given the growth of the Fort Myers-Naples-Marco Island DMA over the last 16 years, and the fact that WBBH’s long-standing NBC affiliation makes it attractive, the valuation Hearst was willing to accept may not be so stunning after all. Moerbitz tells RBR+TVBR WZVN and WBBH combined for $59.6 million in revenue in 2022. “That makes the price somewhat reasonable,” Moerbitz says. Furthermore, the $220.54 million price includes all real estate, studios, towers and equipment for WBBH, in addition for an option agreement for WZVN. That latter fact is key to the valuation.
Meanwhile, given the last radio station sale in the market, Southwest Florida perhaps represents the best dealmaking locale in the U.S. In June 2022, the No. 1-ranked radio station by listeners according to Nielsen Audio was sold by Donna Alpert‘s Alpine Broadcasting Corp. for $8 million. The deal placed WAVV-FM “WAVE 101.1” in the hands of WINK-TV owner Fort Myers Broadcasting Co. And, like the WBBH sale, the WAVV valuation generated much chatter among brokers for being on the high side compared to other recent transactions. For instance, Townsquare Media paid $18.71 million for 35 local radio stations in nine markets in a transaction with Cherry Creek Media. Then came Urban One’s acquisition of WYXB-FM 105.7, WLHK-FM 97.1, WIBC-FM 93.1 and two FM translators home to Sports Talk “The Fan 93.5 and 107.5” — W228CX and W298BB — for $25 million.
Perhaps the biggest deal one can compare with the WAVV sale is that involving the spin of WPYO-FM in the Orlando market and WSUN-FM in Tampa-St. Petersburg to Spanish Broadcasting System from the CXR Radio Station Trust — the Elliot Evers-helmed licensee created to house FCC-directed divestitures by Cox Media Group. SBS paid a total of $12.5 million to gain entry into both the Tampa and Orlando markets, each of which are larger than Fort Myers-Naples.
It should also be noted that the price Hearst is paying for WBBH may also include a valuation associated with its shared services agreement for ABC affiliate WZVN-7 in Fort Myers-Naples, which is being transferred from Waterman to Hearst.
HEARST’S PURCHASE PARTICULARS
The $220.54 million purchase price for WBBH-TV that Hearst and Waterman agreed to could fluctuate by the time closing occurs. That’s because there are clauses pertaining to the “Working Capital Amount” on the closing date in relation to the “Collar Amount.” And, price finalization is required no later than two days before the closing date.
There’s also a Hurricane Ian clause, given the extensive damage the storm cause in fall 2022 to the entire region. At closing, $153,000 for previously agreed-upon repairs of the
WBBH tower ($91,000) and property improvements ($62,000), as recommended in a Property Condition Assessment Report prepared for Hearst by National Due Diligence Services and issued on March 6, will be deducted by Hearst from its payment due at closing.
Serving as Waterman’s legal counsel in this transaction is Anne Goodwin Crump of Fletcher Heald & Hildreth. Hearst’s General Counsel was assisted by Coe Ramsey and Liz Spainhour of Raleigh-based Brooks Pierce.
