Cash-strapped Equity Media Holdings has cut a deal to sell Retro Television Network for $18.5 million to a group headed by Henry Luken, Equity’s largest shareholder. But Equity retained an option to buy RTN back for $27.75 million, exercisable by Christmas Eve of this year, and has retained Thomas Weisel Partners to explore strategic alternatives, possibly working with new partners, to repurchase RTN and finance development of other digital networks. Along with buying RTN, Luken’s group has paid $1.5 million for warrants to purchase 8.05 million shares of Equity for $1.10 per share.
That’s not all, Luken’s investor group is also buying TV stations from Equity in Amarillo, TX; Waco, TX; Ft. Myers/Naples, FL; Minneapolis, MN; Oklahoma city, OK; and Tulsa, OK for $17.5 million – with a $5 million downpayment and the remaining $12.5 million at closing after FCC approval.
Equity will use a portion of the proceeds from these deals, $17.5 million, to pay down debt to approximately $38.5 million.