Official: Fox to Acquire 7 TV Stations From Sinclair

21st Century Fox today officially announced a definitive agreement with Sinclair Broadcast Group and Tribune Media Company to acquire seven television stations for approximately $910 million.

The transaction will grow Fox Television Stations' (FTS) coverage to nearly half of all U.S. households, and its market presence to 19 of the top 20 DMAs, including the addition of key markets that align with Fox's sports rights.

Jack Abernethy, CEO of Fox Television Stations, said "This transaction illustrates Fox's commitment to local broadcasting and we are pleased to add these stations to our existing portfolio.  With this acquisition, we will now compete in 19 of the top 20 markets and have a significantly larger presence in the west, which will enhance our already strong platform. This expansion will further enrich our valuable alignments with the NFL, including our new Thursday Night Football rights, MLB and college sports assets.  We are also happy to add many talented Tribune employees to our group, some of whom we know well."

21st Century Fox has also entered into new network affiliation agreements with Sinclair (and licensees of certain stations to which Sinclair provides services), and will grant Sinclair options to acquire two of its stations, the CW-affiliate WPWR in Chicago, IL, where FTS currently has a duopoly, and FOX-affiliate KTBC in Austin, TX for potential proceeds of approximately $15 million and $160 million, respectively.

Completion of the stations acquisition by 21st Century Fox is anticipated for the second half of this calendar year, subject to the satisfaction of customary closing conditions, including regulatory approvals, and is expected to be coordinated with the closing of Sinclair's proposed acquisition of Tribune.

Meanwhile, Sinclair Broadcast Group this morning reported that its first quarter media revenues increased 6% to $643.7 million versus $607.1 million in 1Q 2017.

Breaking down the 1Q media revenue:

• Political revenues were $7 million, up from $2 million.
• Revenues from digital businesses grew 71% from a year ago.
• Distribution revenues were $314 million, up from $276 million.
• The company’s 1Q total revenues increased 6.1% to $665.4 million, up from $626.9 million.

Chris Ripley

Chris Ripley, president-CEO, commented: “Our first quarter came in well ahead of guidance in all key financial metrics. As expected and reflected in our first quarter guidance, advertising revenue was soft largely due to the lack of Olympics and Super Bowl on many of our stations and with the auto category coming off its recent highs from last year.

“Fortunately, our distribution revenues now make up approximately half our media revenues which makes our business model very resilient to ad market volatility. Furthermore, growth and initiative advances in digital, network, programmatic and addressable advertising are showing results and becoming larger contributors.

“Lastly, our acquisition of Tribune Media is now approaching the final stages with an anticipated closing in late second quarter/early third quarter of 2018, as we await governmental approvals.”