Sinclair Broadcast Group To Buy Eight Allbritton TV Stations For $985 Mln

(RTTNews) - Television broadcasting company Sinclair Broadcast Group, Inc. (SBGI) agreed to acquire the television assets of Allbritton Communications Co. for $985 million. Allbritton is controlled by the Allbritton family through the family's holding company, Perpetual Corp. The TV stations were put on the block in early May.

"We are thrilled to add the Allbritton properties to our growing portfolio and national footprint. To buy a full-blown news operation in our nation's capital and an infrastructure that allows us to be connected to our branches of government and be at the pulse of national issues is a once-in-a lifetime event," Sinclair President and CEO David Smith said in a statement.

In total, Hunt Valley, Maryland-based Sinclair has agreed to purchase the stock of Perpetual and the equity interest of Charleston Television, LLC, both owned and controlled by the Allbritton family.

The deal, which is expected to close in the fourth quarter of 2013, is anticipated to be funded at closing through a bank loan and/or by accessing the capital markets.

Apart from Sinclair, Nexstar Broadcasting Group, Inc. (NXST), Hearst Corp., Meredith Corp. (MDP) and Tribune Co. (TRBAA) were all reportedly in the fray to buy the TV stations.

Allbritton's television assets include a group of eight television stations, the most coveted being WJLA / NewsChannel 8 in Washington that is a 24-hour cable/satellite news network covering the Washington D.C. metropolitan area.

The other seven TV stations are affiliates of Walt Disney Co.'s (DIS) ABC network, covering 4.9 percent of the U.S. TV households. They include WBMA in Birmingham, WJSU in Anniston, WCFT in Tuscaloosa, WHTM in Harrisburg, KATV in Little Rock, KTUL in Tulsa, and WSET in Roanoke-Lynchburg.

"We are especially excited to acquire the NewsChannel 8 local news channel, not only for the content it can provide our existing news stations, but moreover because their regional cable presence provides the perfect platform should we decide to expand it into other markets, especially given the amount of local news we produce across our entire portfolio," Smith added.

The television stations were bought by the Allbritton family about 30 years ago as part of a deal to acquire The Washington Star.

To comply with FCC local television ownership rules, Sinclair expects to sell the license and certain related assets of its existing stations.

Following the closure of the deal, Allbritton will focus all its resources and expanded mindshare to boost its commitment to its news site Politico.

As of March 1, 2013, Sinclair owned, provided programming and operating services pursuant to local marketing agreements, or provided sales services pursuant to outsourcing agreements, to 86 television stations in 46 markets.

Following the deal and on a pro forma basis, assuming consummation of the Allbritton stations and all previously announced acquisitions, Sinclair will be the largest and one of the most diversified television broadcasting companies in the U.S., owning and operating, program or provide sales services to 149 television stations in 76 markets.

In Monday's regular trading session, SBGI is currently trading at $30.16, up $0.35 or 1.16% on a volume of 0.43 million shares.