Broadcast TV M&A slows in Q4 | Media Analysis | Business
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US broadcast station mergers and acquisitions (M&A) volume reached $104.4 million in the fourth quarter of 2016, and closed the year at $5.83 billion, but TV was uncharacteristically silent.


That’s according to SNL Kagan, which found that most of the activity was around radio instead of TV. In the fourth quarter of 2016, 92% of the US broadcast station deal volume ($96.2 million) came from radio deals. Due to the ongoing FCC quiet period on TV transactions as a result of the ongoing spectrum auction, the TV deal market registered a mere $8.2 million.

However, in spite of the FCC Incentive Auction quiet period on TV station transactions, Northern Lights Media, a unit of Gray Television, announced the acquisition of a trio of TV stations in America's northernmost market, Fairbanks, Alaska. It paid $8 million (a 7x cash flow multiple) to owner/operator partners Tanana Valley Television Co and Chena Broadcasting.

Also, in the wake of the $4.6 billion merger of Nexstar Broadcasting Group and Media General, the TV market closed the year with a total of $5.30 billion, 87% of which stems from just one deal.

Meanwhile, October was the busiest month for radio deals in Q4, with 79% of the total transactions taking place in that month. The month of October brought a surge of transactions registering 11 deals above $1 million. All three top radio deals in Q4 also happened in October.

The top deal of Q4 (and the second-largest deal of the year) came in the wake of the Beasley/Greater Media merger. In August, Beasley Broadcast Group placed three stations it bought in the Charlotte-Gastonia-Rock Hill, N.C. market in a trust to comply with FCC regulations. In October, Beasley sold the stations WLNK-FM and WBT-AM/FM, together with WFNZ-FM and an FM translator, to Entercom Communications Corp for $24 million, equating to a 6.0x cash flow multiple. In the absence of any other large deals, Beasley became not only the year's top buyer but also the top seller by deal volume.

The fourth quarter of 2016 also brought the year's largest single-station deal, which involved the same station, as had the year's top-ranked single-station deal at the time. KFWB in Los Angeles changed hands for the second time this year, delivering a $3.2 million profit to short-time owner Universal Media Access, which in February paid $8 million for the station, intending to keep it, but could not refuse Lotus Communications' $11.2 million offer.

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