The TV station airing the Spanish-language Azteca América broadcast network in the nation’s No. 1 Hispanic DMA — Los Angeles — is trading hands.
How is this possible, as the station participated in the FCC’s Spectrum Auction.
The party that holds its Channel-Sharing Agreement just sold the CSA to a Wisconsin-based player, making this a “zombie” deal that sees the transfer of programming rights, and not an actual broadcast TV facility.
In an update to a transaction presented in RBR+TVBR‘s TRANSACTIONS TODAY on Monday, Sept. 11, Southern California License LLC has agreed to sell KAZA-TV, licensed to the island municipality of Avalon, Calif., to TV-49 Inc. for $9 million.
But, there’s more to the story.
The $9 million is actually for KAZA’s CSA, held by Southern California License LLC and Venture Technologies Group LLC. The two entities forged a post-Spectrum Auction CSA that allows KAZA to continue serving the L.A. DMA by using VTG’s 6 MHz channel licensed to KHTV-CD, a Class A station in Los Angeles at Channel 27.
This CSA went into effect on Aug. 25, and that’s what’s being handed to TV-49, an entity tied to Norman Shapiro’s Weigel Broadcasting Co. MeTV VP Evan Fieldman signed off on the asset purchase agreement, FCC documents show.
Weigel is the company behind the digital multicast networks MeTV, a partnership with MGM; and MOVIES!, run in partnership with FOX Television Stations.
A 10% escrow deposit has been made by TV-49, which has been instructed to elect must-carry status for KAZA’s CSA to ensure MVPD carriage in Los Angeles.
Southern California License LLC pocketed $91,116,442 for relinquishing the spectrum for the former KAZA-54.
There was no broker involved in this transaction.
The seller was represented by Stuart A. Shorenstein of Cozen O’Connor.
The buyer was represented by Mace J. Rosenstein of Covington and Burling LLP, a D.C. law firm home to NAB CEO Gordon Smith prior to joining the industry lobbying group.
The trading of channel-sharing agreements, which some refer to as “zombie stations,” has proven to be particularly popular with Hispanic television companies.
In mid-June Univision and William Binnie‘s WBIN Inc. agreed to a deal that would hand Univision a channel-sharing agreement for the latter’s WBIN-35 in Derry, N.H. — part of the Boston DMA — for $16,764,133.70.
As stated in the asset purchase agreement, WBIN has a post-spectrum auction agreement with Univision to use a shared channel (a DT signal) tied to its UniMás affiliate in Boston, the Marlborough, Mass.-licensed WUTF-66. This is the result of WBIN Inc.’s relinquishment of WBIN-35’s spectrum in the FCC auction for $68,081,337.
On May 1, a potentially noteworthy L.A.-market “zombie station” transaction only made possible by the now-concluded FCC Spectrum Auction was struck. The arrangement would have allowed The Meruelo Group to pay $10 million for a channel-sharing agreement that Bob Behar’s Hero Licenseco had reached with Meruelo upon shedding the spectrum of KBEH-63 in Oxnard, Calif., for a whopping $146.6 million.
But, Hero backed out of the deal, which prompted an FCC Public Notice on May 8 that sought comment on the spin of channel-sharing agreements.
Hero’s decision to kill the deal made the Public Notice moot, and thus far there has been no sign of a reprise from the FCC regarding a new Public Notice on the trading of CSAs.
