Sinclair bought the Four Points Media Group from Cerberus Capital Management, but Nexstar Broadcasting Group was well paid for its management of the stations for Cerberus. With the closing of the sale to Sinclair, Nexstar has put some cash in its coffers.
Nexstar says it has received a payment of $6.7 million comprised of management and incentive fees earned for 2011 as well as a termination payment, related to the Four Points sale. Approximately $4.7 million of the payment will be recognized in Nexstar’s Q4 results and the balance of approximately $2 million in Q1 of 2012. Nexstar will use the payment made by Cerberus under the management services agreement for debt reduction and general corporate purposes.
“The Four Points transaction is the culmination of our efforts on behalf of Cerberus to improve the market position and operating efficiencies of these stations and create value for the group. We are confident that under Sinclair’s management, the markets, viewers and advertisers served by these stations will benefit from a continued focus on quality programming and community service. We believe the positive outcome from this transaction for Cerberus, Four Points and Sinclair positions us well to enter into other management services agreements,” said Nexstar CEO Perry Sook.