Gannett, Sander complete affiliate sale to Meredith

Michelle Clancy | 03-03-2014

Gannett Co and Sander Media LLC have completed the previously announced $177 million sale of CBS TV affiliate KMOV-TV to Meredith Corp, following the receipt of regulatory approvals.

As part of the sale, Sander Media has conveyed to Meredith substantially all of its assets used in the operation of KMOV-TV, which Sander Media acquired upon completion of the Gannett-Belo transaction on 23 December 2013.

In addition, Gannett has conveyed certain other assets that are needed to provide services to KMOV-TV, which Gannett acquired from Belo Corp upon close of the Gannett-Belo transaction.

The transaction will not have a material effect on Meredith's third quarter or full year fiscal 2014 financial performance, it said.

"We're pleased to add this high performing station to our portfolio," said Meredith chairman and CEO Stephen Lacy. "The acquisition of KMOV adds another top 25 television market to our group, and is consistent with our successful total shareholder return strategy. Together with KCTV (CBS) in Kansas City, Meredith now has powerful local brands in two of the Midwest's top news and sports markets."

In December, Meredith announced separate definitive agreements to acquire the broadcast assets of KMOV and of two television stations in Phoenix, the nation's 12th largest market. Meredith expects to complete the acquisition of the Phoenix stations KTVK-TV, an independent, and KASW -TV, the CW affiliate by 30 June.

The licence and certain related assets of KASW will be purchased by a third party SagamoreHill of Phoenix, LLC and Meredith will provide certain services for the operation of KASW pursuant to a customary services agreement with SagamoreHill, in accordance with Federal Communications Commission local television ownership rules.

In the first full year post closing, all three television stations are expected to generate combined revenues of $105 to $115 million, and be accretive to run-rate earnings per share by $0.16 to $0.18.
Meredith continues to expect fiscal 2014 full year earnings per share to range from $2.60 to $2.95, and fiscal 2014 third quarter earnings per share to range from $0.63 to $0.68. Ranges for both periods exclude operating results and transaction expenses related to the acquisitions of television stations in Phoenix and St Louis.