Other Gray television markets are seeing changes related to the Schurz acquisition.
In South Bend, Indiana, market (DMA 96), Schurz owns CBS affiliate WSBT-TV and Gray owns NBC affiliate WNDU-TV. Gray previously announced its intention to retain WNDU-TV and divest WSBT-TV.
Gray has now reached agreements with Sinclair Broadcast Group, Inc. to sell all of WSBT-TV’s assets in exchange for the assets of Sinclair’s WLUC-TV in Marquette, Michigan, whose channels serve as the NBC and Fox affiliates for the Marquette market (DMA 180). WLUC-TV is the number-one ranked and highest grossing station in the market, according to the companies. The broadcast cash flow of WSBT-TV and pro forma broadcast cash flow of WLUC-TV are approximately equivalent.
In Rapid City, South Dakota, market (DMA 171), Schurz owns ABC affiliate KOTA-TV and Gray owns Fox affiliate KEVN-TV. Gray will sell to Legacy Broadcasting, LLC all of KOTA-TV’s assets, including FCC licenses, real estate, programming agreements, and retransmission consent agreements, other than those assets used for KOTA-TV’s ABC program stream. The sales price for this transaction is one dollar. Legacy will own and operate KOTA-TV’s MeTV and ThisTV channels independently from Gray following closing. Gray intends to transition the existing ABC program stream to KEVN-TV at closing.
In addition, in the Anchorage, Alaska, market (DMA 148), Gray previously announced that it will acquire from Schurz the market’s NBC affiliate, KTUU-TV. Gray has a deal with Fireweed Communications LLC to acquire KYES-TV, the market’s MyNet affiliate, for $500,000. Gray will apply to the FCC for a “failing station” waiver of the local ownership rules to allow the combination of KTUU-TV and KYES-TV, which the company believes will permit Gray to improve the programming and services offered by both stations.
Gray anticipates closing the latest transactions in the fourth quarter of 2015 or first quarter of 2016. The transactions with Sinclair and Legacy will close simultaneously with the Gray/Schurz transaction.
Wells Fargo Securities, LLC was the financial advisor to Gray on the Wichita and South Bend transactions and Cooley LLP was Gray’s primary legal counsel on the latest deals.
