On October 19, a broker release obtained by RBR+TVBR revealed that Ramar Communications had agreed to sell The CW Network affiliate in Lubbock, along with two low-power facilities, to Gray Television.
The deal required a closer look by the FCC’s Media Bureau. And, it has just given its approval to the deal brokered by Kalil & Co. VP Fred Kalil, giving it a common ownership waiver for the Texas market.
According to an asset purchase agreement posted by the FCC on October 22, The CW Network affiliate KLCW-23, MyNetwork affiliate KMYL-LD 14 and Telemundo affiliate KXTQ-CD 46 are being spun to Gray along with KLBB-LD in Lubbock, the MeTV affiliate, and KABI-LD in Snyder, Tex., airing the Heroes & Icons diginet.
This deal is valued at $10 million, and a $1.5 million escrow deposit is being held by Wells Fargo Bank. A $250,000 indemnity escrow payment will be made at closing.
And, it was consummated by Ramar following the February 11, 2018, death of its founder, Ray Moran, at the age of 82. Moran founded Ramar in 1972.
The KLCW portion of the deal gives Gray a “super-duopoly” in Lubbock. Under FCC rules, KLCW would become a duopoly partner outside of the Top Four rule prohibition, paired with NBC affiliate KCBD-11, a former Raycom Media station.
The four LPTVs do not count with respect to local market concentration, even as Gray will hold a total of six broadcast signals serving Lubbock viewers.
To gain approval of the deal, Media Bureau Video Division Chief Barbara Kreisman took a close look and opened it up for public comment. The application was unopposed. This helped seal the deal, as the Commission said yes to the transaction and granted a waiver of section 73.3555(b) to permit common ownership of KLCW and KCBD-11.
The key to getting the deal done? KLCW’s status as a “failing” TV station.
That is defined as a TV station that “has been struggling for an extended period of time both in terms of its audience share and in its financial performance.”
KLCW meets the test: ratings data showing that KLCW has averaged an
all-day audience share below 1% for the last 12 months. The threshold is 4%. Then, there’s the negative cash flow statements for KLCW for 2017, 2018 and 2019.
Third, Gray asserts that it will transform KLCW into a more viable competitor under common ownership with KCBD. This will be done with KCBD-branded newscasts on the CW Network affiliate, it says.
The sale of KLCW and the LPTVs to Gray was made concurrent to Ramar’s agreement to transfer the license of the FOX affiliate in Lubbock, KJTV-34, and its associated Class A facility, to SagamoreHill Broadcasting. That deal is free of any FCC review.
