U.S. Broadcast Deal Volume Up in Q3


MONTEREY: According to SNL Kagan, broadcast station M&A volume in the U.S. reached $3.04 billion in the third quarter, which saw the deal announcement of Media General's proposed acquisition of Meredith Corp.

Between Q1 2013 and Q3 2014, SNL Kagan registered seven consecutive quarters with deal volumes above $1 billion, driven by large TV-consolidation deals. Starting in Q4 2014, deal activity slowed dramatically. Between October 2014 and August 2015, the firm did not register a single deal above $100 million.

The quarter's top deal announcement, by far, was Media General's $3.10 billion possible acquisition of Meredith Corp. SNL Kagan values the 17 TV stations in 13 markets at $1.81 billion, which would make the deal the TV sector's largest since Media General's purchase of LIN Media in March 2014. This transaction, however, might not take place if Media General's shareholders agree to a bid by Nexstar Broadcasting, announced on September 28, to buy all of Media General for $4.1 billion. Nexstar's offer is not included in the total deal volume numbers.

Gray Television extended its small-market foothold in Q3, paying $100 million for Gazette Company's only TV station in Cedar Rapids, Iowa, and $442.5 million for Schurz Communications Inc. At 8.5-times forward broadcast cash flow, SNL Kagan allocated a deal value of $420.5 million to Schurz's 15 TV stations and two local marketing agreements in seven markets.

Also notching up a deal valued at more than $100 million was Raycom Media Inc., which paid $160 million for Drewry Communications Group's seven TV stations (including one local marketing agreement). Gray's purchase of Schurz and Raycom's acquisition of Drewry were both primarily TV deals, but the transactions also came with a number of radio stations.