Viacom and get it: LIN reels in a pair of UPNs
WNDY-TV Indianapolis and WWHO-TV Columbus OH are headed from Viacom to LIN TV Corp. for 85 million bucks. It gives LIN a triple play in Indy, with CBS WISH-TV Channel 8 and WIIH-CA Channel 17, a Class A entry carrying Univision. The Class A station is nonattributable when determining local ownership cap compliance. The Columbus station, which also carries UPN, will stand alone.
"As many of you know, a large part of LIN's strategy includes the creation of duopolies," said LIN Television President/CEO Gary Chapman at the group's quarterly Wall Street dog and pony show (see related story below). Ideally, we attract a large, dedicated audience for our leading news programming, then we partner that up with a younger station that expands our total audience and reaches a younger demographic. We've been successful in creating duopolies in eight of our 14 markets. Today we announced the purchase of WNDY in Indianapolis and WWHO in Columbus from Viacom. Both are UPN affiliates and will be excellent complements to our duopoly strategy. The addition of these two stations will add another element to our growing initiatives."
The company told analysts that the cash flow multiple on this deal is over 20 times, but that will come down quickly as LIN integrates them into its operations. Both new UPN stations will be run out of master control in Indianapolis and the Indianapolis station will be moved completely into the existing WISH-TV studios. CEO Gary Chapman also said LIN will launch a 10:00 pm newscast on WNDY to be produced by the WISH news department. He also said LIN will be able to reduce program costs at the two stations being acquired from Viacom, indicating that they had rather expensive contracts for syndicated fare.
Asked about duopoly possibilities, Chapman said there are fewer "voices" in Columbus than in Indianapolis, so it didn't appear that LIN would be able to own a duopoly in Columbus under the current eight voices rule. However, he hopes the courts eventually allow the FCC to reduce the voice threshold to five.
As for Viacom, it gets a nice payday and may have cleared some room under the national 39% audience reach cap. Television Group President/CEO Fred Reynolds said, ""This transaction provides us with a terrific value for WNDY and WWHO - - two very good TV Stations operated by a wonderful team of broadcasters. While we're always evaluating our portfolio to optimize performance, the group's strategy is to opportunistically add TV stations in attractive, fast-growing markets. In the first half of this year alone we expect to acquire three additional stations which were announced late last year: KOVR-Channel 13 in Sacramento, WTCN-CA43 and WWHB-CA48 in West Palm Beach."
Are you reading this from a forwarded email?
