It’s a transaction that will likely present more questions than answers, and is most likely one of the more unexpected deals to emerge in recent memory.
Cox Media Group has signed off on paperwork that will transfer some 18 television stations — including major “Big Four” network affiliates — to the parent of recently reinvented cable television network INSP.
What does this mean for the stations CMG is spinning?
That’s perhaps the No. 1 query from industry observers, as CMG and Imagicomm Communications have entered into a definitive agreement involving the sale of the properties.
The FCC’s LMS is expected to have the paperwork uploaded shortly.
“The transaction furthers the strategic evolution of CMG’s broadcast station portfolio and marks INSP’s expansion into broadcast television,” CMG notes of the eye-popping deal, which involves the following properties:
- Alexandria, La. – KLAX-31 (ABC)
- Binghamton, N.Y. – WICZ-40 (FOX)
- Eureka-Arcata, Calif. – KIEM-3 (NBC) & KVIQ-17 (CBS)
- Greenwood, Miss. – WABG (ABC), WABG-HD2 (FOX), WNBD (NBC), and WXVT (CBS),
- Idaho Falls, Idaho – KPVI-6 (NBC)
- Medford, Ore. –KMVU-26 (FOX)/KFBI-48 (Telemundo)
- Memphis – WHBQ-13 (FOX)
- Spokane – KAYU-28 (FOX)
- Syracuse – WSYT-68 (FOX)
- Tulsa – KOKI-23 (FOX) and KMYT-41 (MyNetwork TV)
- Yakima, WA – KFFX-11 (FOX) and simulcast partner KCYU-LD 41 in Tri-Cities, Wash.
- Yuma, AZ – KYMA-11 (NBC)
All but the Tulsa pair and the Memphis property are former Northwest Broadcasting properties, sold by the Brian Brady-led organization to Apollo Global Management right before it obtained majority control of CMG.
WHBQ has been a part of the CMG family since October 2014, when it formally gained control of the property through a trade with Fox Television Stations that gave the entity led by Jack Abernethy ownership of KTVU-2 and KICU-TV (branded as KTVU+) in San Francisco. That deal also yielded CMG WFXT-TV in Boston, a key component of Cox’s TV holdings.
The Tulsa siblings, KOKI and KMYT, entered the Cox Media Group family in July 2012 as part of a $300 million transaction with Newport Television that also gave CMG two television stations in Jacksonville.
Commenting on the transaction, CMG President/CEO Dan York said, “These are important local journalism and community service brands powered by incredible media professionals and journalists who work tirelessly to inform, entertain, and elevate the communities they serve. We are pleased to advance the strategic evolution of our portfolio, are proud of our team members at these stations, and are confident they will continue to excel in their important work as part of the Imagicomm / INSP family.”
INSP Chairman/CEO David Cerullo added, “We are excited to be entering the broadcast television market with this strong collection of brands that are integral to informing and entertaining the communities they serve. We look forward to working with the stations’ talented staff and building upon their rich legacy of journalism and serving their communities, advertisers, and audiences. This acquisition is part of our broad corporate strategy to expand our media ownership across multiple entertainment platforms.”
Financial details are included in the asset purchase agreement, which is expected to be posted on the FCC’s LMS within 24 hours. The parties expect closing to occur in the second half of 2022.
INSP is today known for Westerns and family-oriented programming. It’s been doing so since October 2010 and is a commercially supported network. Before that, INSP was a broadcast ministry, founded by the Rev. Jim Bakker and his wife, Tammy Faye Bakker, as PTL Television Network.
In 1990, after the resignation of Bakker following a well-publicized scandal, the PTL operation declared bankruptcy. From its ashes came INSP, led by CEO Cerullo’s father, Morris Cerullo.
Given that history, will the 18 stations retain their “Big Four” status? That’s highly likely, given their place in the market; digital multicast channels seem the likely home for any family-friendly fare INSP and Cerullo may wish to share via free-to-air television.
Advisors
Truist Securities, Inc. served as financial advisor to INSP and Imagicomm Communications in connection with the Transaction and is acting as left lead arranger on the debt financing. Davis Wright Tremaine, LLP served as lead M&A counsel to INSP and Imagicomm Communications, and Bradley Arant Boult Cummings served as their financing counsel.
Moelis & Company, LLC and LionTree served as financial advisors to Cox Media Group, and it was represented on the transaction by Davis Polk & Wardwell LLP, with Cooley LLP and Morgan Lewis & Bockius LLP serving as special regulatory counsel.
