Spanish Broadcasting System (SBS) is doubling its full-power TV station portfolio with a deal to buy KTBU-TV Houston for $16 million. The deal brokered by Kalil & Co. is expected to close in Q3. It’s the first full-power station acquisition since SBS launched Mega TV five years ago on WSBS-TV Miami.
SBS will pay $8 million cash, with a promissory note covering the $8 million balance.
“Houston is a leading U.S. Hispanic market and this transaction is an ideal expansion of our Mega TV footprint, given the rapidly growing national Hispanic population,” said SBS CEO Raul Alarcon.
The announcement from SBS said KTBU reaches approximately 1.8 million households in the Houston market, which is the nation’s fourth-largest Hispanic TV market.
Seller US Farm & Ranch Supply Company bought the station, licensed to Conroe, TX, from Joel Osteen’s Lakewood Church for $30 million in 2006. RBR-TVBR reported in 2010 on an unusual transaction in which a portion of the stock was sold by a receiver for $2 million. It is currently an independent, airing a variety of foreign language programs on its digital multicast channels.
While this will be only the second O&O for Mega TV, it has affiliates in 11 markets across the US and Puerto Rico, plus cable and satellite distribution nationwide. The network claims distribution to 5.6 million households.
RBR-TVBR observation: Some investors have balked at Raul Alarcon’s insistence on expanding into television, rather than being content to have the nation’s second largest Spanish radio company. But Mega TV grew revenues while the radio side of SBS declined in 2010, although profits remain elusive for the still-young TV operation.