Some television owners could reap a windfall in the spectrum auction.
According to analysis conducted by S&P, some 12 publicly traded companies could generate between nearly $7 billion to just under $13 billion.
Those figures are for 84 MHz at the low-end and 120 MHz at the high-end clearing scenario, and assume the FCC’s incentive auction goes according to plan.
Station owners submitted confidential bids on March 29. The commission plans to announce initial clearing targets and band plans in some three to four weeks, and then mock auctions would begin, we’ve reported.
S&P modeling projects Univision Communications as having the highest take up rate at nearly $2.47 billion and 23 stations that could be tendered or art of channel shares assuming a 120 MHz clearing level. “At the 84 MHz level, that potential take drops to just shy of $1.31 billion, as the overall demand would be lower and the total number of stations needed fewer. At the 120 MHz level, Univision is followed by Comcast Corp. at $2.21 billion, Twenty-First Century Fox Inc. at $2.13 billion and CBS Corp. at $1.86 billion,” writes Robin Flynn, S&P Director, Research, Multichannel TV.
While some other publicly traded groups like Sinclair Broadcast Group Inc. and Media General Inc. have lesser amounts, their potential take is larger than for some others in terms of a per-share premium. For example, for Sinclair, S&P estimates the potential after-tax value at 120 MHz at $10.87.
For CBS, S&P’s calculated after-tax value per share is $2.71, or a 5% premium as of April 6. Its estimates put Tribune Media Co. at more than a $600 million take at 120 MHz or just $237.3 million at 84 MHz.